Business Move: Farfetch Buys Off-White-Licensee New Guards For $675 Million
LONDON, UK — Online fashion retailer Farfetch has just made a new acquisition, picking up brand platform New Guards, which is the licensee of Virgil Abloh‘s Off-White, for $675 million.
According to Farfetch, the acquisition augments Farfetch’s strategy to be the global technology platform for luxury fashion, empowering individuality, and connecting creators, curators and consumers.
José Neves, CEO and co-chair, Farfetch, said: “The addition of New Guards’ brand platform brings a creative and industrial dimension to our suite of capabilities which, combined with our community of more than 650 boutiques, enables us to power and promote both new and existing creative names in the luxury industry to build the brands of the future.”
Milan-based New Guards has launched a number of global luxury fashion brands. Farfetch listed Off-White, Marcelo Burlon County of Milan, Palm Angels, Ben Taverniti, Unravel Project, Heron Preston, Alanui and Kirin Peggy Gou as its brands, but did not state which ones New Guards had a majority stake in. It confirmed, however, that it did not own Off-White.
Not long after the news broke, Abloh offered further clarification on Off-White’s connection with New Guards.
“Off-White would like to clarify our ownership structure. Off-White LLC, which is controlled by Virgil Abloh, owns the trademark of our brand, and NGG is our exclusive licensee pursuant to a multiyear agreement,” he said in a statement. “The New Guards Group transaction with Farfetch will not affect Off-White’s day-to-day operations as the New Guards Group team will become part of Farfetch. We look forward to our ongoing work together.”
According to Farfetch, the New Guards acquisition provides the opportunity to develop and introduce new and highly attractive labels to its platform, along with exclusive capsule collections and collaborations.
A number of the New Guards portfolio brands were already present — though only via boutiques — on the Farfetch Marketplace, including Off-White, which is one of its top 10 most popular brands for Farfetch in terms of gross merchandise value.
Now Farfetch plans to help New Guards’ existing and future portfolio brands maximize their potential by opening new e-concessions on the Farfetch Marketplace, and will operate each brand’s own e-commerce site and digital platforms through its Farfetch platform solutions capabilities.
At the same time, Farfetch will leverage its existing technology, data and logistics infrastructure to tap into near-real-time supply and demand data to match New Guards’ production in a much quicker cycle. This “connected wholesale” model will create meaningful productivity gains by minimizing overstock and strengthening distribution, which should also reduce the need for markdowns, Farfetch said.
“The addition of New Guards’ brand platform brings a creative and industrial dimension to our suite of capabilities which, combined with our community of more than 650 boutiques, enables us to power and promote both new and existing creative names in the luxury industry to build the brands of the future,” Neves added in a statement.
Davide de Giglio, cofounder and CEO of New Guards Group, said: “We started New Guards Group because we had a vision to build a platform that could support the best creative talent in the world and build iconic brands. Creative visionaries need to be empowered with best-in-class design studios, industrial capabilities and global distribution channels. Farfetch has the technology, expertise and vision to take our business to the next level and unleash the talent of the future.”
The acquisition of New Guards comes after Farfetch picked up famed London fashion boutique Browns in 2015 and has also just launched on China’s JD.com’s platform through its acquisition of Top Life.