YNAP receives 100 million euro investment from Alabbar Enterprises

London - Luxury online retail group Yoox Net-a-Porter Group (YNAP) has its sights on accelerating its growth in the Middle East after receiving capital investment from Alabbar Enterprises, which acquired a 4 percent stake in YNAP.

The strategic investment, a capital injection of 100 million euros, was paid for by Alabbar Enterprises, a Dubai-based entity, controlled by Mohamed Alabbar. The entrepreneur is said to be the driving force behind the city's economic growth as Alabbar is the founder and chairman of Emaar Properties, parent company of Emaar Malls Group, which is the owner and operator of shopping malls and retail business in Dubai including the Dubai Mall.

YNAP to accelerate growth in the Middle East

Alabbar Enterprises LLC also operates and invests in a number of businesses throughout the Middle East, South East Asia and Africa across a wide range of sectors and owns a host of fashion and luxury interests in Asia and the Middle East, such as RSH, the Singapore-based pan-Asian marketer, distributor and retailer.

As a strategic shareholder, Alabbar will be in the right position to offer the online group "invaluable insights and support, which will be key to developing the Group’s rising business in the promising yet complex Middle Eastern luxury e-commerce market," said Yoox Net-a-Porter Group in a statement.

"I am pleased to have been provided with the opportunity to invest in and support Yoox Net-a-Porter Group, the leader in online luxury retail," commented Mohamed Alabbar, Chairman of Emaar Properties and Emaar Malls Group. "With an unrivalled product offering and superior customer experience, I look forward to collaborating with the Management team and Board, as the Group further expands within the region."

YNAP revealed it has opted to raise 100 million euros of equity capital, less than the maximum of 200 million euros authorised by the extraordinary shareholders meeting last July, in light of the lower than previously envisaged cash requirements. The board does not plan to utilize its authorization for the remaining 100 million euros, added the luxury group.

Alabbar Enterprises acquires stake in Yoox Net-a-Porter Group

The capital increase will be executed through the issuance of 3,571,428 shares at a price of 28 euros per share, a 5.7 percent premium compared to YNAP's closing share price on April 18. Once completed, Alabbar will hold a 4 percent stake of Yoox Net-a-Porter Group outstanding ordinary share capital, equal to 2.7 percent of the total issued share capital, and has committed to a 18-month lock-up period on the entire number of subscribed shares.

"I sincerely admire Mr Alabbar for his forward-thinking and relentless drive to innovate, a vision that has led to the creation of the world’s biggest mall," added Federico Marchetti, Chief Executive Officer YNAP. "His track record in delivering exclusive luxury and retail experiences across the Middle East will provide us with invaluable insights in the fast-growing regional luxury fashion market."

The Middle East currently accounts for a 5 percent share of the global luxury consumption, which has been witness to the increasing internet and e-commerce penetration. YNAP aims to used the financial resources raised through the capital increased over the next two years to growth in the region and develop a common omni-channel platform, which will serve all customers across all geographies and store fronts.