Farfetch, Alibaba and Richemont have confirmed a global strategic partnership to provide luxury brands online, giving enhanced access to the Chinese market.

Farfetch will launch on Alibaba’s luxury platforms in China, including the Tmall Luxury Pavilion and Luxury Soho platforms, as well as Alibaba's cross-border marketplace Tmall Global.

As part of the deal, Alibaba and Richemont will invest $300 million each in private convertible notes issued by Farfetch. Alibaba and Richemont will also invest $250 million each in Farfetch China, taking a combined 25 per cent stake in a new joint venture which will include Farfetch’s marketplace operations in the region.

In addition, Alibaba and Richemont have an option to purchase a further combined 24 per cent of Farfetch China after the third year of the joint venture’s formation.

Separately, Artemis has also agreed to increase its existing investment in Farfetch with a $50 million purchase of Farfetch Class A shares.

As part of the alliance, Farfetch will support luxury brands with both mono-brand and multi-brand distribution strategies, including e-commerce websites and apps, omnichannel retail technology and access to the Farfetch and Tmall Luxury Pavilion marketplaces via a single integration.

Daniel Zhang, chief executive of Alibaba Group, said: “The Chinese luxury market - which is expected to account for half of global luxury sales by 2025 - consists of hundreds of millions of young, digitally-native consumers.

"By partnering with Farfetch and expanding our existing relationship with Richemont, we will accelerate the digitisation of the global luxury retail industry and transform the luxury shopping experience for consumers.”

Farfetch chief executive José Neves said: “This announcement is a major step in our mission to connect the curators, creators and consumers of the luxury fashion industry.

"The $1.15 billion investment in Farfetch from Alibaba Group, Richemont and Artemis is a strong validation of our position as the global platform for luxury.”

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