NEW YORK, United States — When Farfetch surprised investors by paying $675 million to acquire New Guards Group in August, the luxury marketplace emphasised that the strategy would allow it to test, launch and scale the “brands of the future.”
But its immediate payoff lies more in New Guards’ brand of the moment, Virgil Abloh’s Off-White, which it helped launch in 2014. An outstanding question at the time of Farfetch’s acquisition, however, was when that relationship would expire; New Guards controls the company that licenses Off-White’s trademarks, but Abloh would be free to take his business elsewhere after that deal ends.
On Friday, Farfetch indicated it has plenty of time to develop the next Off-White: in a statement, the company told BoF New Guards’ contract with Abloh runs through 2035, and cannot be renegotiated or terminated before 2026.
That gives Farfetch at least seven years to draft off Off-White’s success. For now, those plans include increasing direct-to-consumer sales both online and in stores.
Currently, wholesale accounts for 95 percent of New Guards Group’s total sales. Farfetch plans to relaunch OffWhite.com, underpinned by Farfetch’s platform, in the fourth quarter and increase the amount of Off-White product sold on the Farfetch marketplace, as well as work more closely with Farfetch’s network of boutiques.
A representative for Off-White declined to comment on the details of the licensing agreement. At the time of the acquisition, the brand released the following statement:
“The New Guards Group transaction with Farfetch will not affect Off-White day-to-day operations as the New Guards Group team will become part of Farfetch. We look forward to our ongoing work together.”