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Farfetch has acquired the New Guards Group, the parent company of luxury streetwear brand Off-White, in a £556m deal.
The online luxury marketplace revealed that the consideration payable by Farfetch will be split equally between cash and Farfetch shares, with the exact amounts to be determined at completion following customary adjustments.
The deal brings a number of luxury streetwear brands to the group’s portfolio including Palm Angels, Ben Taverniti, Unravel Project and Heron Preston. This is in addition to Off-White, founded by current Louis Vuitton artistic director Virgil Abloh which Farfetch already counts as one of the top 10 most popular brands for Farfetch in terms of Gross Merchandise Value.
The company added the acquisition provides the “opportunity to develop and introduce new and highly attractive brands to the Farfetch platform, along with exclusive capsule collections and collaborations to further enrich the consumer experience and boost consumer engagement with the Farfetch brand”.
José Neves, CEO and co-chair, Farfetch, said: “The addition of New Guards’ brand platform brings a creative and industrial dimension to our suite of capabilities which, combined with our community of more than 650 boutiques, enables us to power and promote both new and existing creative names in the luxury industry to build the brands of the future.
“The brands of the future will have three core elements. First, a creative tastemaker able to leverage digital channels to engage a global community; second, best-in-class design, planning and manufacturing; and third, direct-to-consumer global online distribution, complemented by a connected wholesale presence in the most prestigious physical boutiques. This is what the combination of Farfetch and New Guards brings to the industry.”
He added: “Together, we can not only continue to develop New Guards’ current portfolio, but will also be uniquely positioned to bring many new talents to life with the combined layers of the Farfetch platform.I believe this new dimension of our strategy expands and advances our vision of being the global platform for luxury, at the service of creators, curators and consumers, united for the love of fashion.”
The transaction is expected to close in the third quarter of 2019, subject to the satisfaction or waiver of closing conditions.
In its results for the second quarter of the year ending 30 June, the retailer also announced today (8 August) record GMV of $488m (3402m) and record revenues of $209m (£172m). However, losses after tax were found to have widened from $17.7m to $89.6m (£73.8m).
