LONDON — Here, five observations by Johann Rupert, chairman of Cartier, Dunhill and IWC parent Richemont, on the day he announced late-stage talks with Farfetch about creating a new, “neutral” e-commerce platform, fulfilling a long-held dream:
On luxury and sustainability:
“We should, as the luxury goods industry, be very, very careful what we’re doing. We are incredibly fortunate. Sometimes we act like heroes, but quite frankly, we are not that special, and quite frankly, we’re not necessary. If you’re talking about energy, electricity, food production, where do we come on the food chain? Stone last. We are nice-to-haves, so we have to be especially careful about our carbon footprint, and what products we use in our manufacturing processes. Quite frankly, society and investors will not tolerate any slackness from us as luxury goods producers.”
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On Chinese President Xi Jinping’s call to achieve “common prosperity”:
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“China’s president did not say ‘stop consumption.’ What they’re against is a vulgar display of the disparity in wealth. If you look at the economics of China, it’s been an investment-driven economy, and they are not backing off the drive to have consumption growth. They wanted to calm down the vulgar, and the dopamine effect of children being addicted to being online all the time. Both of these are very, very popular decisions in China.”
On the activist investor Daniel Loeb, who was reported to have taken a stake in Richemont via his hedge fund Third Point. Richemont did not confirm the reports:
“We started [talking to Farfetch] a long time ago, and maybe some investors read properly what we were doing — and invested. We can’t comment on Mr. Loeb, but I think he clearly took us more seriously than you guys did,” Rupert told analysts in a call on Friday. Rupert described Loeb as a very sophisticated investor. “He did what anybody else could have done, which is to buy shares. And good luck to him. He made money.”
On whether Richemont will ever sell to, or merge with, Kering:
“We are close to the Kering people. But Richemont is not for sale, we are not interested in merging. We believe in our own businesses; we believe in our performance going forward. Why should we dilute our shareholders, all of our shareholders, when we think our growth could be better than the other businesses in the foreseeable future?”
On the late-stage discussions to unite Yoox Net-a-porter with Farfetch and other companies to create a “neutral” e-commerce platform with no majority shareholder:
“This is not a spinoff. This is not a carve-out. This is the realization of a dream of some six years ago when I beseeched other industry players to join us on a neutral platform. I stated that I didn’t think that even the biggest player could do this alone because it would take too much money. I said that we needed an industry effort. In those days I was looking in west, at Amazon, and in the east, to Alibaba.”