Mo­hamed Alab­bar and Rashid Alab­bar

Yoox Net-A-Porter Group, Mo­hamed Alab­bar part­ner

Kuwait Times - - BUSINESS -

YOOX NET-A-PORTER GROUP SpA (MTA: YNAP), the world’s lead­ing on­line lux­ury fash­ion re­tailer is de­lighted to an­nounce a joint ven­ture with Sym­phony In­vest­ments, an en­tity con­trolled by Mo­hamed Alab­bar, to cre­ate the Mid­dle East’s undis­puted leader for on­line lux­ury re­tail, in a part­ner­ship that will draw on the re­gion’s enor­mous growth po­ten­tial. The part­ner­ship will see Mo­hamed Alab­bar focus his en­tire on­line lux­ury re­tail ac­tiv­ity in the re­gion ex­clu­sively through the new joint ven­ture.

YNAP will hold a 60% stake in the joint ven­ture (“JV”), which will be fully con­sol­i­dated in YNAP’s ac­counts, while Sym­phony In­vest­ments will own the re­main­ing 40%. The JV will man­age all of the Group’s ex­ist­ing multi-brand on­line stores in the re­gion - NET-A-PORTER, MR PORTER, YOOX and THE OUTNET-as well as, in agree­ment with the brands, se­lect ex­ist­ing and fu­ture On­line Flag­ship Stores “Pow­ered by YOOX NET-A-PORTER GROUP” that have sig­nif­i­cant busi­ness po­ten­tial in the Mid­dle East.

The new com­pany will op­er­ate in the Gulf Co­op­er­a­tion Coun­cil coun­tries (“GCC”) -the United Arab Emi­rates, Saudi Ara­bia, Kuwait, Qatar, Bahrain and Oman. The JV may ex­pand to other coun­tries in the Mid­dle East and North Africa in the fu­ture. To pro­vide Mid­dle East­ern lux­ury cus­tomers with a ful­ly­lo­calised of­fer, the JV will es­tab­lish on-the­ground op­er­a­tions, which will al­low YNAP to cap­ture the re­gion’s sig­nif­i­cant growth po­ten­tial.

In par­tic­u­lar, the JV’s lo­cal­iza­tion strat­egy will in­clude: - The estab­lish­ment of a Dubai-based en­tity to bring the com­pany closer to its cus­tomers: a lo­cal of­fice with ded­i­cated sales & mar­ket­ing, cus­tomer care and PR teams will pro­vide Mid­dle East­ern cus­tomers with a highly tai­lored of­fer­ing that will set a new standard of cus­tomer ser­vice in the re­gion and fur­ther drive brand aware­ness; - the open­ing of a new dis­tri­bu­tion cen­tre in Dubai pow­ered by YNAP’s omni-stock techno-lo­gis­tics plat­form to guar­an­tee the high­est level of ser­vice, in­clud­ing premier same-day de­liv­ery; - the de­vel­op­ment of a lo­cal­ized of­fer­ing rang­ing from Ara­bic-lan­guage cus­tomer care and con­tent, as well as lo­cal cur­rency and pay­ment meth­ods.

The JV will open the lo­cal of­fice and dis­tri­bu­tion cen­tre in Dubai by end of 2017. YOOX and THE OUTNET will de­but in 2018, while NET-APORTER and MR PORTER will launch in 2019, fol­lowed by se­lect On­line Flag­ship Stores. “The Mid­dle East is one of the fastest grow­ing global cen­ters for lux­ury re­tail. The re­gion also has a sig­nif­i­cant pop­u­la­tion of over 200 mil­lion young peo­ple who are tech-savvy and in­flu­ence lux­ury re­tail de­ci­sions.

With this joint ven­ture to be based in Dubai, a global busi­ness & leisure hub, we are pi­o­neer­ing a never-be­fore on­line lux­ury re­tail ex­pe­ri­ence that in­te­grates lux­ury with techno-lo­gis­tics. It will re­de­fine the re­tail sec­tor, and cre­ate a brand-new way to ac­cess the world’s high-end brands brought by YNAP. A ground-break­ing ini­tia­tive, the JV will serve as go-to on­line des­ti­na­tion for lux­ury re­tail and set new in­dus­try bench­marks in cus­tomer ser­vice, speed of de­liv­ery and di­ver­sity of choice” said Mo­hamed Alab­bar, Chair­man of Sym­phony In­vest­ments.

“We are thrilled by the po­ten­tial of the Mid­dle East mar­ket: com­bin­ing YNAP and Mo­hamed Alab­bar’s strengths, we look for­ward to giv­ing shop­pers in the re­gion ac­cess to a fan­tas­tic lux­ury as­sort­ment with our un­par­al­leled ser­vice and con­tent. We were de­lighted to wel­come Mo­hamed Alab­bar as a strate­gic in­vestor ear­lier this year and to­gether we are now em­bark­ing on a ma­jor ex­pan­sion in the re­gion,” said Fed­erico Marchetti, Chief Ex­ec­u­tive Of­fi­cer of YOOX NET-APORTER GROUP.

This part­ner­ship will com­bine the unique ex­pe­ri­ence and ex­per­tise of both par­ties. YNAP will con­trib­ute its bur­geon­ing busi­ness in the re­gion, as well as its strong ex­ist­ing brand recog­ni­tion and a high-value cus­tomer base. It will also pro­vide long-stand­ing ex­per­tise as the world’s lead­ing on­line lux­ury re­tailer, plus a world-class techno-lo­gis­tics plat­form that is tai­lored to lux­ury fash­ion. Sym­phony In­vest­ments will bring its unique ex­pe­ri­ence of lux­ury re­tail in the Mid­dle East along with its un­matched knowl­edge of lux­ury con­sumer trends and its ex­ten­sive net­work in the re­gion.

The founder of Sym­phony In­vest­ments, Mo­hamed Alab­bar, is also the Chair­man of Emaar Prop­er­ties and Emaar Malls, and is world renowned for suc­cess­fully de­vel­op­ing and man­ag­ing The Dubai Mall, the world’s largest re­tail des­ti­na­tion. Sym­phony In­vest­ments will make a sig­nif­i­cant cash con­tri­bu­tion to the JV, to be phased over the first three years of the ven­ture, which will sup­port YNAP’s ex­pan­sion in the Mid­dle East and the re­lated in­vest­ments.

The JV fur­ther strength­ens an ex­ist­ing re­la­tion­ship that was forged when Alab­bar in­vested in YNAP through sub­scrip­tion for a Ä100 mil­lion cap­i­tal in­crease in April 2016. Sym­phony In­vest­ments, along with its af­fil­i­ates, op­er­ates and in­vests in busi­nesses in the Mid­dle East, South­east Asia and Africa across a va­ri­ety of sec­tors in­clud­ing lux­ury fash­ion, re­tail, e-com­merce, min­ing, and real es­tate, among oth­ers. Mo­hamed Alab­bar is now lead­ing the dig­i­tal trans­for­ma­tion in the Mid­dle East with the launch of Noon.com which aims to be a gen­er­al­ist ecom­merce plat­form that will in­clude pay­ments and lo­gis­tics en­ablers.

He also led two in­vestor groups in buy­ing a com­bined 16.45% stake in Dubai-based global lo­gis­tics provider Aramex. The Mid­dle East re­gion ac­counted for3%of­global lux­ury con­sump­tion in 20151and is ex­pected to sig­nif­i­cantly out­pace the growth of the global per­sonal lux­ury goods mar­ket over the next five years2. The re­gion boasts one of the high­est GDP per capita world­wide2, a par­tic­u­larly high con­cen­tra­tion of high-net-worth in­di­vid­u­als (“HNWIs”) and a promis­ing e-com­merce land­scape, driven by a young and mo­bile-friendly pop­u­la­tion, grow­ing in­ter­net pen­e­tra­tion and pub­lic in­vest­ments in IT, e-ser­vices and tele­coms in­fra­struc­ture.

The joint ven­ture will have an in­def­i­nite du­ra­tion; how­ever, the agree­ment al­lows Sym­phony In­vest­ments to exit the JV af­ter a few years of op­er­a­tions. In ad­di­tion, the agree­ment en­vis­ages that YNAP will have the right to ex­er­cise a call op­tion on Alab­bar’s stake dur­ing pre­de­fined time pe­ri­ods. YOOX NET-A-PORTER will ap­point the ma­jor­ity of the JV’s Board of Di­rec­tors and will nom­i­nate the Chief Ex­ec­u­tive Of­fi­cer and the Fi­nance Man­ager. The Chair­man of the board will be ap­pointed by Sym­phony In­vest­ments.

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