Farfetch founder Jose Neves is considering the move after a troubled New York Stock Exchange listing for the loss-making British company, and is working with advisers at JP Morgan, the Telegraph newspaper reported on Tuesday.

The company, in which Neves has a stake of 15%, declined to comment to Reuters on Wednesday.

Richemont, which has a deal in place to sell its Yoox Net-A-Porter fashion and accessories business to Farfetch said it was “carefully monitoring the situation.”

It said it was reviewing its options around the deal, announced in August 2022, under which it will receive an initial 58.5 million Farfetch shares.

“Richemont would like to remind its shareholders that it has no financial obligations towards Farfetch and notes that it does not envisage lending or investing into Farfetch,” Richemont said in a statement on Wednesday.

Royal Bank of Canada said if Farfetch delisted, it could attempt to renegotiate or renege on the deal.

A person familiar with the matter said Richemont had “definitely no intention” of putting money into Farfetch, but declined to comment if a delisting would void the deal.

Still, Zuercher Kantonalbank analyst Patrik Schwendimann said Richemont’s statement showed the company was distancing itself from Farfetch and the transaction was now less likely.

“There’s still a possibility for Plan A – a Farfetch deal to buy a 47.5% stake in YNAP - but where that had a 90% probability about a year ago, the probability for me was already below 50% last week and this assumption for me is now confirmed,” he said.

On Wednesday, Richemont said neither its divisions nor YNAP, have adopted Farfetch’s platforms, and would continue to run their own sales platforms.

This would make it easier for Richemont to untangle itself from the arrangement with Farfetch and find a new buyer or technology partner for YNAP, ZKB’s Schwendimann said.

Last year, Richemont agreed to sell a stake of 47.5% in its Yoox Net-A-Porter (YNAP) fashion and accessories business to the U.S.-listed company, with an arrangement by which Farfetch could also acquire the rest.

But financial troubles at Farfetch, whose share price has dropped steeply in recent months, have raised questions about the deal, which was recently cleared by European authorities in the last regulatory hurdle.

Farfetch on Tuesday said it would not announce its third quarter results which were due on Wednesday, adding that previous forecasts or guidance could not longer be relied upon.

By John Revill

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