Alibaba eyes to invest in online fashion retailer Farfetch
In this article (5)
Alibaba Group Holding Ltd 9988.HK is in advanced talks to invest nearly $300 million in online luxury fashion retailer Farfetch Ltd FTCH.N, the Information reported on Monday, citing people familiar with the matter.
Shares of London-based Farfetch jumped about 16% to $32.59 following the news.
The two companies are also in talks to create a Chinese joint venture, the report said here, adding that Cartier-owner Richemont, which has teamed up with Alibaba to create mobile applications, is also considering investing in Farfetch alongside the Chinese e-commerce giant.
Both Farfetch and Alibaba were not immediately available for comment.
Farfetch, which counts Alibaba’s competitors JD.com 9618.HK and Tencent Holdings Ltd 0700.HK among its investors has been betting on China’s burgeoning online luxury goods world. Chinese consumers make up a third of luxury goods purchases worldwide.
Terms of the current and past deals with Tencent and JD would not prevent Alibaba from investing in Farfetch, the Information said, citing a source.
Questions & Answers
Q.What is the potential investment amount Alibaba is considering for Farfetch?
What is the potential investment amount Alibaba is considering for Farfetch?
Alibaba Group Holding Ltd is reportedly in advanced discussions to invest almost $300 million in the online luxury fashion retailer Farfetch Ltd, according to reports.
Q.What other companies might be involved in investing in Farfetch?
What other companies might be involved in investing in Farfetch?
Cartier-owner Richemont, which has previously collaborated with Alibaba on mobile applications, is also reportedly considering an investment in Farfetch alongside Alibaba.
Q.What is Farfetch's strategy regarding the Chinese market?
What is Farfetch's strategy regarding the Chinese market?
Farfetch has been actively focusing on China's expanding online luxury goods market, recognizing that Chinese consumers account for a significant portion of global luxury purchases.
Q.Will Farfetch's existing ties with other Chinese firms prevent Alibaba's investment?
Will Farfetch's existing ties with other Chinese firms prevent Alibaba's investment?
No, a source cited by the Information stated that the terms of past agreements with Alibaba's competitors, Tencent and JD.com, would not obstruct Alibaba's potential investment in Farfetch.
Reader pulse
Alibaba's Farfetch move:
17,482 votes so far