Zalando faces a probe by Germany’s Ba Fin financial regulator over alleged disclosure failures in its 2025 accounts tied to the €1.1bn acquisition of About You. The regulator alleges the online retailer omitted details about Danish billionaire Anders Holch Povlsen’s stake in both companies pre-takeover. Shares plummeted 5%, though Zalando insists the issue is “purely formal and immaterial.”

The investigation stems from Zalando’s failure to disclose in its annual report that Povlsen, owner of Bestseller, held significant shares in both firms during the 2024 deal. The acquisition, which secured 73% of About You’s shares via binding agreements with investors like Otto Group and Heartland, aimed to counter rivals such as Shein. Zalando projected €100m in annual cost savings by 2028 and plans to consolidate logistics, including shutting its Erfurt hub, affecting ~2,700 jobs. Critics argue the omission risks investor trust amid tighter EU oversight.

Zalando defends its transparency, claiming takeover details were publicized during the offer stage. However, the probe underscores regulatory focus on related-party transactions. The retailer’s AI-driven cost cuts and influencer marketing strategy remain central to its growth narrative, even as operational restructuring intensifies. With fashion e-commerce margins shrinking, investor patience for missteps is thinning.