South Korean e-commerce group Coupang has entered an agreement to purchase the business and assets of online luxury company Farfetch.

The strategic acquisition will strengthen Coupang’s position as a leader in the $400bn global luxury goods segment.

It will also provide Farfetch with $500m of emergency capital to continue operations.

The Farfetch marketplace offers products from 1,400 brands, boutiques and department stores to customers in more than 190 countries and territories.

The retailer also owns luxury fashion suppliers Browns and Stadium Goods, and New Guards, a centre for developing global fashion brands.

Under its Luxury New Retail initiative, Farfetch provides a range of consumer-focused channels and enterprise-level solutions for the luxury fashion industry.

The company will combine Farfetch’s presence in the luxury ecosystem with its operational and innovative logistics to optimise the experiences of customers, brands and boutiques across the globe.

Coupang founder and CEO Bom Kim stated: “Farfetch is a landmark of the luxury landscape and has been a transformative force in demonstrating that online luxury is the future of luxury retail.

“Farfetch will rededicate itself to providing the most elevated experience for the world’s most exclusive brands, while pursuing steady and thoughtful growth as a private company. We also see tremendous opportunities to redefine the customer experience for luxury clients everywhere.”

Global investment firm Greenoaks assisted Coupang in the acquisition.

Farfetch founder, CEO and chairman José Neves stated: “We are thrilled to be partnering with such a respected Fortune 200 company that is committed to investing in innovations that transform all aspects of the customer experience with Farfetch.”

Farfetch saw its revenue drop by 1.3% to $572.1m in the second quarter of fiscal 2023.