Dec 18 (Reuters) — New York-listed e-commerce giant Coupang said on Monday it was planning to buy Farfetch Holdings, in a deal that will provide the struggling online luxury fashion retailer with $500 million in capital to stay in operation, the companies said in a joint statement on Monday.
“Farfetch will rededicate itself to providing the most elevated experience for the world’s most exclusive brands, while pursuing steady and thoughtful growth as a private company”, said Coupang founder and chief executive officer Bom Kim.
Trading in shares of Farfetch, which has a market capitalization of $226.7 million, were halted, while those of Coupang, were down 3.7% in early trading.
Coupang, which operates food delivery, video streaming and payment services in markets including South Korea, Taiwan, Singapore, China and India, struck the deal with an investor group that held over 80% of the outstanding $600 million term loans.
Investment firm Greenoaks is partnering with Coupang for the investment.
Last month, the Telegraph newspaper reported that Farfetch founder and CEO José Neves was in talks with top shareholders to take the company private.
JPMorgan advised Farfetch on the deal.
After Coupang’s announcement, Richemont on Monday said it has scrapped its agreement to sell part of its online fashion and accessories business Yoox Net-A-Porter (YNAP) to Farfetch.
(Reporting by Savyata Mishra in Bengaluru, Mimosa Spencer in Paris and Abigail Summerville in New York; Editing by Anil D’Silva and Bernadette Baum)
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