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Johann Rupert, chairman of Swiss luxury house Cie Financiere Richemont SA, said on Friday he had no mortal enemies in his industry, known for its bitter personal rivalries and historic feuds.

That’s a good thing, because Richemont, which owns online retailer Yoox Net-a-Porter, is cozying up to its nearest competitor in the fast-growing web market: New York-listed British retail platform Farfetch Ltd.

Richemont and China’s Alibaba Group Holding Ltd. will each buy $300 million in convertible notes in Farfetch, as well as invest $250 million each in its Chinese subsidiary. Richemont will have a 12.5% stake in the latter and could eventually, through the convertible, have a shareholding in Farfetch.

This is obviously good news for Farfetch, which gets two powerful new investors joining long-time shareholder Tencent Holdings Ltd. But the move has advantages for AAA perfect replica Cartier-owner Richemont too.

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Rupert said there could be further cooperation between YNAP and Farfetch in the future. But putting them together would be the ultimate prize, particularly if this were to result in a spinoff or sale of YNAP by Richemont. Although investing in internet shopping makes sense strategically, the group’s online businesses led by YNAP continue to be loss-making.

YNAP and Farfetch are both online sellers of bling, but they operate differently. YNAP is like a traditional department store: It buys goods and holds them until they are sold to customers. The majority of Farfetch’s business is selling products on behalf of boutiques, which pay it a commission on every item it moves.

Combining both approaches would create a powerful platform that would dominate online luxury. This scale may also help to overcome the challenging economics of digital retail, whereby sellers must serve demanding customers and deal with high rates of returned goods. And it could help stave off competition from Amazon Inc., which has set its sights on high-end dresses and handbags.

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Richemont isn’t the only company thinking this way. Artemis, the investment vehicle of the Pinault family, which is the biggest shareholder in Gucci-owner Kering SA, will also increase its investment in Farfetch, with a $50 million share purchase. Meanwhile, Francois-Henri Pinault, chief executive officer of Kering, will join Rupert and executives from Farfetch and Alibaba in a new steering committee focused on digital development of luxury brands. Richemont and Kering already cooperate in eyewear. Another point of contact will bring the two giants even closer.

This element is bound to spark speculation about a tie-up between Richemont and Kering. A combination of the two would make sense: It would bring Richemont’s prowess in watches and jewelry together with Kering’s muscular position in fashion and handbags. It would also make a formidable rival to competitor LVMH Moet Hennessy Louis Vuitton SE, which has now been emboldened by acquiring Tiffany & Co.

Rupert insisted on Friday that he was not interested in any mergers and that Richemont was not for sale. But the pandemic has shaken up the luxury industry, and it would not be surprising to see more new alliances forged.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.

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