WWD : Amazon In Talks to Purchase Net-a-Porter

LONDON — Could Amazon be the latest e-commerce giant to court Net-a-porter?

WWD has learned that Amazon is engaged in “ongoing talks” to buy Net-a-porter, which could command a valuation of up to 2 billion euros, or $2.19 billion at current exchange.

Details of the talks could not be learned, and an Amazon spokeswoman declined comment Wednesday. As in any discussion, the talks may or may not lead to an actual deal.

Amazon has been looking to buy a luxury e-commerce company, and the financial community is abuzz with the prospect of Compagnie Financière Richemont spinning off Net-a-porter, which it purchased in 2010 and is not a core part of its hard luxury business. A Richemont spokesman also declined comment.

Asked generally about Net-a-porter’s future at Richemont, Luca Solca, managing director at Exane BNP Paribas, said a possible scenario is for the luxury group to monetize the value of the fashion e-tailer, and sell it to a company willing to invest in pure-play luxury retail in the long term.

“One ideal candidate for that could potentially be Amazon,” Solca told WWD. “Amazon needs a separate mall to engage in luxury credibly, sort of what Tao Bao does with Tmall.” Earlier this year, Solca floated the idea of an initial public offering or divestment of Net-a-porter, and said it would be “a positive” for Richemont.

Solca added that Net-a-porter helped Richemont “understand that digital is important, and to export best practices to the core of the business.” However, he said he wonders whether Richemont wants to be in the pure-play Internet retail business in the long-term. “There is no obvious strategic fit in my mind,” he said.

Amazon is eager to make its mark on the fashion world, which executives have said the Web giant sees as a key area of potential growth and is already one of its key sectors. It has opened an online store on Alibaba Group Holding Ltd.’s Tmall.com as it seeks to expand in China, joining retailers that include Zara owner Inditex, Burberry and Asos.com.

In February, Amazon revealed that the group and its fashion sites — Amazon Fashion, East Dane and MyHabit — were becoming the presenting sponsor of New York Fashion Week: Men’s, the first edition of which will be held in July. It also signed on as the new sponsor of the biannual fashion weeks in New Delhi, the latest edition of which opened Wednesday.

Purchasing a company like Net-a-porter — with its glossy packaging and edgy, high-end fashion offer — would be a mega-move, catapulting Amazon firmly into the designer arena.

Last week, Citigroup’s Thomas Chauvet published a report comparing Richemont with rival Swatch Group. In it, he floated the possibility that Richemont could use the five-year anniversary of the purchase of Net-a-porter to spin off the e-tailer and seek an IPO or sell it to private equity or strategic investors.

Citi called Net-a-porter “a high-quality asset operating in a highly-coveted segment” and pointed to the site’s “lack of obvious industrial, cost and commercial synergies with the rest of the group.” Citi added that it’s “unlikely” Net-a-porter would ever distribute Richemont’s higher-end brands such as Cartier, Van Cleef & Arpels and Jaeger-LeCoultre. Richemont also owns Chloé and Dunhill, which Net-a-porter and its men’s site Mr Porter do sell.

“We also believe that a (potential) disposal of the fashion brands would leave NAP even more as an isolated entity within Richemont,” the report said, adding it could envisage a disposal of Net-a-porter within the next 12 to 24 months.

Chauvet also suggested this could be Richemont’s ideal moment to dispose of Net-a-porter, “considering M&A activity in the online luxury space, Amazon’s potential move into online luxury retailing, and rich consensus valuation multiples enjoyed by Asos, Yoox Group and Zalando.”

While some analysts believe that Net-a-porter could command a valuation of 2 billion euros, other banks estimate it would be worth two times the ratio of enterprise value to sales, giving it a valuation of 1.2 billion euros to 1.5 billion euros, or $1.31 billion to $1.64 billion.

Meanwhile, at the end of this month, Richemont will likely exercise its option to buy out the remaining minority shareholders in Net-a-porter, including the company’s founder and executive chairman, Natalie Massenet. Massenet is acting, ad interim, as the group’s chief executive officer as the company searches for a successor to Mark Sebba, who retired last year, but who remains a non-executive director.

Richemont has repeatedly denied reports that it’s interested in selling Net-a-porter, and in November, the group’s chief financial officer, Gary Saage, said during a conference call: “We love all our 20 ‘children,’ and none of the companies is for sale.”

In 2013, Richemont denied rumors that it was in talks to sell Net-a-porter to e-commerce giant Yoox Group, which had been actively courting the company. In November, shortly after Saage discussed Richemont’s “children,” talk of a possible Net-a-porter IPO flared up, and later settled down.

Industry sources have said that Pascal Cagni, an Internet veteran who had been working for Net-a-porter Group in a consultancy capacity last year and who was widely tipped as the front-runner for the role of ceo, drew up preliminary plans to prepare Net-a-porter for an IPO. The sources said management rejected them and Cagni left the company when his contract reached its end.

Net-a-porter is a fast-growing company, although it has struggled — for a variety of reasons — to turn a profit. In November, Saage confirmed that Net-a-porter tipped into profitability in the first half, and its sales growth exceeded the group’s average.

Richemont does not disclose the balance sheets of its separate divisions, but according to the latest figures on Companies House, the official register of British businesses, losses at Net-a-porter narrowed to 12.9 million pounds, or $20.2 million, from 19.3 million pounds, or $30.5 million, in the 12 months to March 29, 2014. Operating profit as a percentage of sales rose to 4.2 from 3.7 percent in the previous year. Sales advanced 22.6 percent to 532.6 million pounds, or $835.1 million, on the back of the new investments, and from growth across all markets, particularly the U.S., and the Asia-Pacific region.

*SCHAEFFLER SEES 2015 REV. GROWING 5%-7% AT CONSTANT FX


*SCHAEFFLER SEES 2015 REV. GROWING 5%-7% AT CONSTANT FX
*SCHAEFFLER SEES 2015 CAPEX RATIO 6%-8% OF REV.
*SCHAEFFLER 2014 EBITDA EU2.17B VS EU1.66B
*SCHAEFFLER 2014 EBIT EU1.52B VS EU1.01B
*SCHAEFFLER 2014 INDUSTRIAL REV. RISE 3.3% TO EU3.14B
*SCHAEFFLER 2014 AUTOMOTIVE REV. RISE 10% TO EU8.98B
*SCHAEFFLER SEES 2015 EBIT MARGIN 12%-13%

(BFW) Bollore Selling 17% Stake in Havas for EU6.40-EU6.70/sh

BN 03/25 16:47 *HAVAS SHARES OFFERED AT EU6.40 TO EU6.70: TERMS
BN 03/25 16:47 *BOLLORE GROUP SELLING 17% STAKE IN HAVAS: TERMS
Bollore Selling 17% Stake in Havas for EU6.40-EU6.70/sh
2015-03-25 16:50:50.56 GMT


By Andrea Snyder
(Bloomberg) -- Bollore selling 71m shrs in Havas.
* SocGen joint bookrunner in Havas shr sale


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>>> What to look at today - 26th of March 2015

Dow -1.62% S&P -1.46% Nasdaq -2.37% Russell -2.34%
US Market traded lower, with S&P closing below its 50d MA..Technology was under pressure...the energy sector added 1.2% thanks to daylong strength in crude oil that sent the energy component higher by 3.5% to $49.19/bbl. WTI crude received a measure of support from dollar weakness as the Dollar Index (96.88, -0.32) slipped 0.3%...the consumer staples sector (-0.2%) slipped into the red during the final hour, but still finished well ahead of the broader market thanks to a 34.9% surge in the shares of Kraft (KRFT 83.15, +21.83) after the company agreed to merge with H.J. Heinz. KRFT shareholders are expected to receive a special dividend of $16.50 when the deal closes. US After Hours FIVE +4.9%, RHT +4.6%, PVH +1.3%, PSUN -5.9%, RARE -2.9%, VRNT -2.3% following earnings/guidance...Economic calendar was rather sparse, and much of the focus fell on sharp escalation of geopolitical tensions in Yemen. Following overnight reports that Saudi Arabia is mobilizing artillery on the border and earlier rumors that Yemeni President has fled the country by boat from Aden, Saudi Arabia led an air assault on positions of Houthi rebels. There is no indication yet that ground troops will participate in the offensive, though Saudi Arabia has also reportedly allocated up to 100K troops for Yemen operations. A statement from the White House indicated the US will authorize logistical and intelligence support to Saudi-led military operations but will not be taking any direct military action. There was no word out of Tehran, where Iran's Shia govt is widely suspected of financing the Houthi militants. WTI May crude oil contract spiked up about $3 toward $52/brl on reports of air strikes before retreating below $51. Brent also rose over $3 above $59.50 before coming off to $58. CAD also tracked higher oil, with USD/CAD falling some 50pips below 1.2480...Greece debt problems also remain pressing after EFSF officials announced the EFSF fund will not return €1.2B in contributions that Athens claims it overpayed. Bank of Greece Gov Stournaras sought to soothe tensions, noting 2015 growth will be higher than in 2014, and the economy is recovering. Stournaras noted the uncertainty related to the bailout is weighing on outlook, and as soon as it is resolved, recovery will gather speed...In China, comments out of the PBoC reiterated intentions to keep monetary policy "prudent", aiming to prevent and resolve any potential financial risks. Note that for the week, PBOC operations resulted in a net injection of CNY10B - the first injection after 4 previous weeks of net drain.

Nikkei -1.39% Hang Seng +0.03% Shanghai +0.29%

RUB $56.29 WTI $51.03 (+3.72%) CHFEUR 0.9502 CHF 0.9574

Eur$ 1.0992 S&P -0.35% EuroStoxx -0.94% Dax -1.25% SMI -0.50%

Macro :
- Oil Rallies for Fifth Day on Yemen; Gulf, Tech Stocks Retreat
- Why Bombing the 39th Biggest Oil Producer Is Roiling Markets (1)


Keep an eye on :
- AF FP : Air France-KLM Revises Debt Target to EU4.6b End 2015 vs EU5b
- ANA SM : Acciona Gets EU1.8b Syndicated Loan
- ADS GY : Adidas Sees Net Income Up About 15% Per Yr Through 2020
- BALN VX : Baloise 2014 Net Income Misses; Dividend Plan Meets Forecast
- BYW6 GY : Baywa Sees 2015 Ebitda, Ebit, Pretax Rising
- MAU FP : Maurel & Prom Says It May Close Or Sell Some Units; Net Falls
- PFV GY : Pfeiffer Vacuum Sees 2015 ‘Noticeable‘ Rev., Ebit Margin Gain
- SRCG SW : Sunrise 2014 Net Loss CHF8.4m vs CHF81.9m Loss
- TEF SM :Telefonica Prepares EU3.05b Capital Increase
- TIT IM : Telecom Italia May Revive Metroweb Talks: Reuters
- DG FP : Vinci Wins Contract for GBP750m Welsh Motorway Project

>>> Brokers Upgrades & Downgrades - 26th of March 2015

>>> Up
*APPLUS RAISED TO OUTPERFORM VS NEUTRAL AT CREDIT SUISSE
*COFACE RAISED TO BUY VS HOLD AT DEUTSCHE BANK
*KERING RAISED TO NEUTRAL VS SELL AT GOLDMAN
*MARSHALLS RAISED TO BUY VS HOLD AT JEFFERIES
*OPHIR ENERGY RAISED TO BUY VS HOLD AT JEFFERIES
*SANTANDER RAISED TO EQUALWEIGHT VS UNDERWEIGHT AT BARCLAYS
*SARAS RAISED TO BUY VS HOLD AT SOCGEN
*STHREE RAISED TO BUY VS NEUTRAL AT HSBC

>>> Down
*AEGON CUT TO HOLD VS BUY AT DEUTSCHE BANK
*ALLIANZ CUT TO HOLD VS BUY AT DEUTSCHE BANK
*BANCO SABADELL CUT TO EQUALWEIGHT VS OVERWEIGHT AT BARCLAYS
*BAYER CUT TO NEUTRAL VS BUY AT UBS
*BOOKER CUT TO NEUTRAL VS BUY AT GOLDMAN
*GENUS CUT TO HOLD VS ADD AT NUMIS
*PIRELLI CUT TO NEUTRAL VS BUY AT UBS
*SHELL CUT TO REDUCE VS NEUTRAL AT HSBC
*WOLSELEY CUT TO NEUTRAL FROM OUTPERFORM AT DAVY
*XING CUT TO NEUTRAL VS BUY AT GOLDMAN


>>> PT Change


>>> Initiation
*CAIXABANK RATED NEW EQUALWEIGHT AT BARCLAYS, PT EU4.5
*JOHN LAING GROUP RATED NEW OVERWEIGHT AT BARCLAYS, PT 240P
*JOHN LAING GROUP RATED NEW OUTPERFORM AT RBC, PT 230P
*JOHN LAING GROUP RATED NEW BUY AT HSBC, PT 250P
*NATIONAL EXPRESS RATED NEW OVERWEIGHT AT BARCLAYS, PT 331P
*STAGECOACH RATED NEW OVERWEIGHT AT BARCLAYS, PT 412P

>>> Call
>> Stock
*AVIVA ADDED, AXA REMOVED FROM CITI FOCUS LIST EUROPE
*POLYMETAL ADDED TO GOLDMAN CONVICTION BUY, CEEMEA FOCUS LISTS
*WOLSELEY REMOVED FROM CREDIT SUISSE EUROPE FOCUS LIST
>> Sector
*EUROPE INSURANCE SECTOR CUT TO NEUTRAL-WEIGHT AT DEUTSCHE BANK

(BFW) Maurel & Prom Says It May Close Or Sell Some Units; Net Falls

ONE 03/26 06:00 Maurel & Prom: Résultats 2014
BN 03/26 06:03 *MAUREL & PROM CITES COUCAL-CAP LOPEZ PIPELINE DIFFICULTIES
BN 03/26 06:02 *MAUREL & PROM SAYS IT COULDN'T PRODUCE AT NORMAL RATE IN 1Q
BN 03/26 06:01 *MAUREL & PROM SAYS IT MAY CLOSE OR SELL SOME UNITS
BN 03/26 06:00 *MAUREL & PROM 2014 NET EU13.2M
Maurel & Prom Says It May Close Or Sell Some Units; Net Falls
2015-03-26 06:07:37.483 GMT


By Francois de Beaupuy
(Bloomberg) -- Maurel says 2014 net income falls 79% to
EU13.2m.
* Says 2014 Ebitda fell 17% to EU352m
* Says co. now focusing on assets with strong potential
* Says 1Q 2015 has been hurt by a lower-price effect and a
quantity effect related to operating challenges encountered
by the operator of the pipeline linking Coucal to Cap Lopez

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