Farfetch secures lifeline as Coupang extends $746m rescue loan
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The news: South Korean ecommerce firm Coupang has announced its plans to acquire online luxury marketplace Farfetch, as the platform edges closer to insolvency.
The numbers: Softbank-backed Coupang, and investment group Greenoaks Capital, will extend a bridge loan to Farfetch of USD500 million ($746.82 million), to buy its assets and delist the platform.
The context: Farfetch has lost over 90% of its value since it listed on the NYSE in 2017, having struggled to maintain its rapid growth during the Covid-19 pandemic and retain brands on the platform.
An SEC filing submitted by Farfetch states that the transaction is supported by creditors who currently hold over 80% of the company’s USD600 million term loans. It also notes that the deal will terminate Farfetch’s proposed acquisition of Yoox Net-a-Porter from Swiss luxury group, Richemont.
The sources: Coupang, Securities and Exchange Commission
