Farfetch, an online retailer of luxury fashion goods, is taking a stake in the Neiman Marcus Group (NMG) as part of a broader strategic partnership that will see Bergdorf Goodman and Neiman Marcus join the Farfetch platform.
Farfetch will make a minority common equity investment of up to $200 million in NMG, joining existing investors, including PIMCO, Davidson Kempner Capital Management and Sixth Street. NMG will use the proceeds to further accelerate growth and innovation through technology and digital capabilities investments.
Through this agreement, NMG will utilize Farfetch Platform Solutions (FPS) to re-platform the Bergdorf Goodman website and mobile application. As a result, Bergdorf Goodman will introduce its digital customer experience and curated offering to globally, integrating with its New York City flagship. Neiman Marcus will also use select FPS modules, including foundational international services. Both Bergdorf Goodman and Neiman Marcus will join the Farfetch Marketplace as a partner, adding participating brands in key global geographies.
“I believe the U.S. luxury market is at a pivotal point,” said José Neves, Farfetch founder, chairman and CEO. “While the U.S. is proving to be a long-lasting source of growth for the luxury industry, fueled by younger generations who are highly engaged with the category, businesses will have to significantly upgrade their digital capabilities, powering both online and offline customer journeys, to meet these new customer expectations and stay ahead in what is going to be a competitive space in the coming years.”
Neves continued, “I greatly admire the Neiman Marcus Group for its distinguished role in our industry both with Neiman Marcus and Bergdorf Goodman and its stellar management team, including Geoffroy and Darcy. We share the same unwavering vision for the future of luxury, with the customer at the center of all we do. This partnership revolutionizes the luxury landscape globally, both online and offline, by combining NMG’s iconic presence in the U.S. and Farfetch’s Luxury New Retail vision and technology.”
“We are thrilled to be partnering with Farfetch to accelerate our e-commerce strategy, creating a seamless customer experience,” said Geoffroy van Raemdonck, CEO, Neiman Marcus Group. “José and the entire Farfetch team have built a best-in-class technology platform and are the ideal partner to help us grow Bergdorf Goodman into an even stronger global digital luxury retailer. Farfetch’s investment demonstrates their confidence in our omnichannel strategy, and we look forward to partnering with Farfetch to continue revolutionizing the luxury customer experience and delivering value to all our stakeholders.”
“Our partnership with Neiman Marcus Group is another example of how FPS has become a preeminent digital partner for the luxury fashion industry,” said Kelly Kowal, chief platform officer, Farfetch. “This is a significant digital transformation opportunity that will allow us to unlock massive value for Neiman Marcus Group, its shareholders and its customers, who will now be able to shop from wherever they are in the world.”
“By leveraging the technology and expertise of Farfetch, we will further advance our integrated strategy to expand our reach and services to customers globally, bringing our one-of-a-kind iconic New York fashion brand to customers worldwide,” said Darcy Penick, president, Bergdorf Goodman. “This is an incredible opportunity to amplify our brand, further embed the Bergdorf Goodman experience across online and in-store, and continue our investments to further establish Bergdorf Goodman as a digital luxury leader on a global scale.”
Completing the global strategic partnership and investment is expected by the third quarter of 2022, subject to the satisfaction of customary closing conditions. Following completion of the agreements, NMG will not be a related party of Farfetch as defined by Item 7.B of Form 20-F.
J.P. Morgan is serving as exclusive financial advisor to NMG, and Kirkland & Ellis LLP and Norton Rose Fulbright LLP are serving as legal counsel. Bryan Cave Leighton Paisner and Taylor Wessing LLP serve as legal counsel to Farfetch.
Photo courtesy José Neves and Geoffroy van Raemdonck
