Yoox Net-a-Porter has struck a €130m (£110.9m) joint venture with Dubai-based tycoon Mohamed Alabbar as the online luxury retailer sets its sights on big spenders in the Middle East.
The tie-up comes just seven months after the online retailer sold a €100m stake to Mr Alabbar in a deal that was billed as the “world’s biggest online retailer joining forces with the world’s biggest bricks-and-mortar retailer”.
Federico Marchetti, Ynap’s chief executive, said that he had been talking to Mr Alabbar about a partnership even before he struck the £1.3bn takeover of British upmarket rival Net-a-Porter last year.
Mr Marchetti said that he had taken the decision that a local partner was needed and the joint venture will mean local same-day deliveries in Dubai with a local-language Arabic website.
The online retail boss shrugged of concerns about a luxury slowdown and said that online luxury spending continued to grow at a rate of 15pc and 80pc of Middle Eastern shoppers purchased goods using their mobiles.
About Mr Alabbar
Mr Alabbar is chairman of London-listed Emaar Properties, which counts the tallest building in the world, the Burj Khalifa, and the Dubai Mall, the world’s most visited shopping mall, among its properties. He is also a lead adviser to Sheikh Mohammed bin Rashid Al Maktoum, the leader of Dubai and refereed to as the “master builder of the Middle East”.
Around 3pc of the world’s total luxury spending emanates from the Middle East and the region’s 10pc growth rate is five times the global market.
“By 2020 the Middle Eastern luxury market is expected to be worth $12bn as it has the highest concentration of high net worth individuals than anywhere else in the world.” — Federico Marchetti of YNAP
A number of retailers are waking up to the retail potential in the Middle East with Vogue recently launching Vogue Arabia to cater to the a new conservative but fashion conscious crowd. Last week Amazon was also rumoured to be buying Dubai-based retailer Souq.com for $1bn.
Mr Marchetti shrugged off Vogue’s recent foray into luxury online retail with Style.com and said he was “not concerned at all” by its arrival.