Noteholder group mobilizes to challenge Coupang deal to buy Farfetch
Summary
The Group is comprised of institutional investors with combined AUM of over US$1 trillion, holding over 50% of Farfetch’s 3.75% Convertible Senior Notes due 2027. The default arose from the suspension of trading and delisting of Farfetch from the New York Stock Exchange, which was imposed by the NYSE as a result of the proposed sale to Coupang. At the time of the announcement of the agreement, analyst consensus (including its house broker JPMorgan) estimated Farfetch’s enterprise value to be in excess of US$3 billion. Further, and equally concerningly, the terms of a transaction support agreement (TSA) with Coupang, Greenoaks and others, which Farfetch entered into on 18 December 2023, risks making it unviable for any other bidders to present an alternative, value-maximizing offer. “Allowing this transaction to complete fails to maximize the value of the assets of the Company, at a time when at least three other credible parties were publicly reported to be interested in all or parts of the business.