YOOX merges with Net-A-Porter

YOOX acquired the Net-A-Porter Group from Richemont in a transaction agreed in March 2015 and completed on 5 October, settled entirely in shares, the seller receiving 50% of the capital of the combined company on a fully diluted basis. Its voting rights were capped at 25% and it undertook not to dispose of shares representing a quarter of the capital for three years. The enlarged group took the name YOOX Net-A-Porter Group, remained incorporated in Italy and stayed listed in Milan. The Net-A-Porter Group operates online retailing of luxury fashion through net-a-porter.com for current-season women’s collections, mrporter.com for men and theoutnet.com for previous-season merchandise. It purchases the inventory it sells rather than acting as an intermediary, and combines that trading with editorial content produced in the manner of a magazine. Neutrality determined the structure. A platform distributing competing houses cannot be seen to belong to one of them, which is why a luxury group holding half the capital accepted voting rights limited to a quarter and accounted for its interest by the equity method rather than consolidating it. The two businesses occupied adjacent positions rather than the same one, the acquirer having built its scale on previous-season merchandise and on operating stores for brands, while the target sold current collections at full price, which gave the combination a range across the season and across the two models of online distribution. The combined company planned a capital increase of up to 200 million euros to fund its development and admit further shareholders, in which Richemont expected to participate. The transaction produced a non-cash accounting gain of approximately 317 million euros in the seller’s accounts for the year to March 2016 and was otherwise neutral to its earnings. Federico Marchetti, founder of YOOX, became chief executive of the combined group and Natalie Massenet, who had founded Net-A-Porter in 2000, executive chairman, a position she left in September 2015 before completion. Richemont launched a tender offer for the whole of YOOX Net-A-Porter in January 2018, obtaining European competition clearance that March