The Yoox Group and Net-A-Porter are merging to create an online luxury fashion company with revenue of nearly £1 billion, in an all-share deal between the two groups.
The new company will be called the Yoox Net-A-Porter Group. Richemont, the owners of Net-A-Porter, will hold 50 per cent of the company’s shares and 25 per cent of the voting rights.
It comes a week after rumors of Amazon’s interest in Net-A-Porter started appearing online. Amazon was looking to pay up to £1.5 billion to acquire Net-A-Porter, but it looks like the luxury fashion retailer didn’t want to work with the Seattle based e-commerce giant.
Yoox claims Net-A-Porter’s social expertise and design will help grow the brands Yoox owns and maintains. Apart from Yoox and thecorner.com, the company runs over 30 brand websites, which it will maintain post merger.
Net-A-Porter will also remain an independent website post merger, meaning in the short term nothing will change apart from Net-A-Porter chief executive Natalie Massenet moving to executive chairwoman.
It is an interesting move and one that will shake up the luxury fashion end of online retail. The combined force could rival most other fashion providers, since neither Alibaba or Amazon are capable of selling items for over £1,000.
The luxury fashion market is valuable to Amazon and other e-commerce providers due to the massive profit margins one can acquire from each sale. The issue is actually getting people to put down a lot of money on a shirt or dress, without them looking for promotional material or a cheaper provider.