Fashion retailer FarFetch has chosen New York for its upcoming IPO rather than its home market of London.
Founded in 2007 by Portuguese entrepreneur José Neves, the luxury fashion platform has over 2,200 employees in 13 offices around the world.
The London-based company filed its F-1 registration statement with the SEC yesterday and is looking to list under the ticker FTCH.
In its F-1, the company revealed it has 935,772 active online customers - up 43.6% over the past 12 months.
Revenues grew 59.4% to $386m from 2016 to 2017 and the company said it made an operating profit of $136.9m for the first six months of 2018.
Despite this, net loss after tax stood at $68.4m for the first six months of the year.
Reports suggest that the float could value the fashion firm at £4bn, and the decision to list in New York is seen as a blow to the London Stock Exchange.
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One of the reasons the company has chosen to list in New York rather than London is down to the increased power CEO José Neves will have over the FarFetch board with a US placing.
This is because Neves holds a large amount of Class B shares in the company, which vote at a 20:1 ratio compared to Class A shares.
Speaking about this increased voting power, which is more accepted in the US, FarFetch said in its F-1 statement: “Our chief executive officer, Mr. Neves, has considerable influence over important corporate matters due to his ownership of us.
“Our ordinary shares are divided into Class A ordinary shares and Class B ordinary shares. Holders of Class A ordinary shares are entitled to one vote per share in respect of matters requiring the votes of shareholders, while holders of Class B ordinary shares are entitled to 20 votes per share, subject to certain exceptions.
“Due to the disparate voting powers associated with our two classes of ordinary shares… Mr. Neves has considerable influence over matters such as electing or removing directors, approving any amendments to our Articles and approving material mergers, acquisitions or other business combination transactions.
“In addition, under our Articles, our Board will not be able to form a quorum without Mr. Neves for so long as Mr. Neves remains a director. This concentrated control will limit your ability to influence corporate matters and could also discourage others from pursuing any potential merger, takeover or other change of control transactions, which could have the effect of depriving the holders of our Class A ordinary shares of the opportunity to sell their shares at a premium over the prevailing market price.”
Last year, FarFetch raised $397m from Chinese e-commerce giant JD.com in a deal that valued the company at over $1bn.
Speaking about his plans for the future of the company, Neves said: “Despite all this growth, this industry is still in its infancy.
"Only 9% of luxury sales happen online, and the 91% that happen offline are still conducted as if we were in the 1990s! Physical retail, not just online, will need to reinvent itself, and we want to be the champions of that revolution too.
“Whether future consumer channels will be dominated by voice-enabled interfaces, AR/VR, or the Internet of Things, our API can seamlessly plug into any of these technologies, the same way we have already integrated with conversational ecommerce apps and launched a full-catalogue WeChat store in China.
"We believe our API-enabled platform makes our marketplace core business truly future-proof.”
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