The joint-venture with one of the Middle East luxury distributors accelerates the rumors of an IPO this year. Farfetch is also preparing to open a new office in Dubai.
Farfetch’s most recent step towards an IPO has been taken: the unicorn founded by the Portuguese José Neves just concluded a joint-venture with the Chalhoub Group, one of the largest distributors of luxury goods and fashion of the Middle East, and that still has a large growth potential in the e-commerce market.
The news were disclosed this Thursday by the Business of Fashion (BoF), which also discloses the company should move forward with an IPO on this fall. In a press release, Farfetch announced they are also preparing to open their first office in Dubai, which means they have a local presence in the top 10 luxury markets in the world.
Because this is one of the largest luxury markets in the world, the Middle East is extremely important for Farfetch.
This partnership places Farfetch as one of the key-players in the luxury market, in addition to being an extra point in the company’s strategy towards their “ambition of a global business”. “Because this is one of the largest luxury markets in the world, the Middle East is extremely important for Farfetch”, José Neves stated, referring to the joint-venture. “We are present in China and in Hong Kong, Japan, Russia, Latin America, Korea and the United States — and the Middle East was a great gap in our strategy. We plan to grow in the Middle East, as quickly as possible”, he added.
The agreement with Chalhoub includes creating a website in Arabic — which should happen in the first semester of the year –, the curation of products designed for local consumers and the broadening of the network of partner suppliers, with a retailers network that will include the group’s brands, such as Level Shoes, Level Kids and Tryano, according to BoF.
“Because of our client-orientation, we wanted to get them new proposals while accelerating our digital journal. The partnership with Farfetch seems to be the obvious choice, since we share the same values of excellency and entrepreneurial spirit, as well as the same passion for fashion, for our clients, for innovation, excellency in retail and memorable experiences”, the CEO of the group Chalhoub, Patrick Chalhoub explains, quoted in the press release sent by Farfetch.
“Farfetch is a pioneer in a new context of luxury fashion, while the Group Chalhoub was a pioneer in luxury retail in the Middle East for the past 62 years. So this is the perfect marriage between both groups. As a first contribution for Farfetch’s development in the region, we are glad to announce that Level Shoes, Level Kids and Tryano will become Farfetch’s boutique partners, which will give them a global reach”, he adds.
This is the second time Farfetch associates with international giants to go forward with strategical partnerships: in June of last year, the company announced a joint-venture with JD.com, the second largest e-commerce player in China, to increase their sales in that market. As part of that deal, JD.com invested 397 million dollars in Farfetch, an investment that valued the luxury platform in over three billion dollars.