Net-A-Porter investors win row over its ‘too cheap’ £950 million sale price

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Six months ago, Richemont agreed to sell the internet retail phenomenon founded by fashion guru Natalie Massenet for £950 million to Italian rival Yoox.

But minority shareholders including Massenet’s original investor, fashion entrepreneur Carmen Busquets, claim it was worth much more.

They own 8% to 10% of Net-a-Porter, and some have refused to sell their shares to Yoox, considering the price to be far too low. 

Under Net-A-Porter’s ownership structure, the minority shareholders have the right to request arbitration over any sale, and yesterday an independent arbiter essentially agreed with their complaint, saying the business was actually worth between £1.3 billion and £1.5 billion.



Sources said the arbiter’s valuation meant the minority shareholders are entitled to be compensated for the difference in value of their stakes, up to £55 million.

Richemont and Yoox declined to say which of them would have to pay the compensation.

Busquets has been vocal in her criticism of the deal, saying recently that Richemont acted too hastily in choosing Yoox, citing Net-A-Porter’s sales, double-digit growth and profitability. 

She recently told industry bible Womenswear Daily the business is worth “well over” £2 billion to £3 billion to represent its “trophy status”.



Yoox shares fell 0.22 cent to €29.63 in Milan as news of the arbiter’s decision emerged, while Richemont dropped Swfr 0.45 to Swfr 83.25 in Zurich.

The two sides have indicated the merger deal will not be affected. Richemont will hold 50% of the combined company’s shares as part of the deal, which will be finalised in October.

The higher valuation that emerged today is less than an earlier £1.9 billion valuation that a Morgan Stanley appraisal carried out on behalf of the shareholders.

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August 8, 2015 |
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