Farfetch tops price range in flotation

FARFETCH PRICED its shares above its targeted range on Friday in a New York flotation that values the online luxury retailer at over $5.8bn and underscores how big a bet web sales have become for high-end brands.

E-commerce is emerging as one of the biggest growth drivers for luxury labels initially fearful of diluting their image by selling online.

London-based Farfetch – a 10-year-old site that connects shoppers to hundreds of boutiques and fashion labels but carries no inventory – is one of a clutch of rapidly-expanding multi-brand platforms that got an early foothold in the market.

The company set the offer price in its initial public offering at $20 per share – surpassing the range of $17 to $19 that had already been increased.

It will raise $885m in the listing, with the company issuing 33.6 million new shares and existing shareholders, including early backers such as Advent Venture Partners and Vitrurian Partners, selling 10.6 million.

The IPO values Farfetch, founded by Portuguese entrepreneur Jose Neves, at $5.8bn, according to the share count available in its latest filings.

When including employee share options this would rise to $6.3bn, the company said.

Existing Farfetch investors include JD.com, China’s second largest e-commerce firm.