J. Michael Evans, President and board member at Alibaba, has resigned from the board of directors at Farfetch, according to a company filing with the US Securities and Exchange Commission (SEC). Farfetch qualifies the resignation as being “in furtherance of the arm’s length commercial relationship” it has maintained with Alibaba Group Holding and says that Evans had no disagreement with management, operations, policies or practices.
The commercial relationship in question is the Farfetch China joint venture, established in November 2020. Alibaba and Richemont (part of Cartier) pledged to invest $300 million each in private convertible notes issued by Farfetch Limited and to purchase a 25 percent stake in the venture for an additional $250 million each, with an option to purchase a further 24 percent after the third year of operation.
Farfetch, meanwhile, would open luxury shopping channels on Alibaba’s Tmall Luxury Pavilion and Luxury Soho.
According to Reuters, Evans joined the Farfetch board in December of the same year.
As we reported late last month, Farfetch will not release its results for the third quarter and has nullified its guidance. The reason might be new plans to take the company private.
According to a story in The Telegraph on Nov. 28, founder José Neves would appear to be negotiating with J.P. Morgan and top shareholders – Richemont among them – to “bring an abrupt end to its short but calamitous stint on the New York Stock Exchange.” Farfetch stock is down 90 percent since its listing on the NYSE in 2018. (Farfetch was founded in 2007 and inaugurated its e-commerce marketplace for luxury boutiques in 2008.) Neves holds a 15 percent stake but 77 percent of the voting rights.
The Telegraph’s reporting suggests that Alibaba and Richemont are presumably in favor of the move, but a day later, Richemont issued a press release to “remind its shareholders that it has no financial obligations towards Farfetch” and “does not envisage lending or investing into Farfetch.” It is now “reviewing its options in respect of its arrangements with Farfetch announced on 24 August 2022.” These involve Farfetch’s acquisition of Yoox Net-a-Porter. For now, as Richemont notes, Yoox continues to operate on its own platform.
