Coupang Shares Slip After Farfetch Deal
By Dean Seal
Shares of Coupang fell after the company said it would acquire the online luxury company Farfetch Holdings.
The stock was down 3.7% at $16.39. Shares are up 11% year-to-date.
The global retailer said the Farfetch acquisition will better position it as a leader in the personal luxury goods space and give Farfetch access to $500 million in capital.
To effect the transaction, Coupang and the investment firm Greenoaks Capital Partners have established a limited partnership that will acquire Farfetch's business and assets.
Farfetch's shares sank to an all-time low last month after the luxury group Richemont said it had no plans to invest further in the e-commerce company. The disclosure followed speculation that Farfetch may be taken private by its founder and chief executive, José Neves, with support from Richemont and e-commerce giant Alibaba.
Farfetch disclosed around that same time that it won't stand by its previous guidance, issue new guidance or publish third-quarter results by a Nov. 29 deadline.
After Coupang said it would buy Farfetch on Monday, Richemont said it won't complete a planned transaction with Farfetch involving its Yoox Net-A-Porter platform, and expects to lose out on convertible senior notes previously issued by Farfetch.
The deal is subject to an exclusivity period through April 30, with Farfetch set to pay a $20 million termination fee to the limited partnership if it enters into a competing transaction before that time.
Coupang didn't provide a timeline for when it expects the deal to close.
Write to Dean Seal at dean.seal@wsj.com
(END) Dow Jones Newswires
December 18, 2023 11:23 ET (16:23 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.-
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