Prada announced on Tuesday that it has acquired Versace in a deal valued at $1.38 billion (£1.04 billion). This acquisition combines two prominent Italian luxury fashion houses under one management. The transaction amount is significantly lower than the approximately $2 billion that Versace’s previous owner, Capri Holdings, paid for the brand in 2018.
The acquisition enhances Prada’s portfolio, which also includes Miu Miu, as the company aims to strengthen its competitive stance against major rivals such as LVMH, owner of Dior, Fendi, and Louis Vuitton. Recently, Donatella Versace, who became the brand’s creative chief in 1997 following the death of her brother Gianni Versace, stepped down after 27 years with the company. She has been succeeded by Dario Vitale, a former design director at Miu Miu.
The sale reflects a loss of approximately $700 million for Capri Holdings, attributed to a decrease in Versace’s sales and challenges faced by Capri’s other brands, including Michael Kors and Jimmy Choo. Under Capri’s ownership, Versace shifted its design aesthetic from its signature ornate styles to more minimalist offerings while also increasing prices.
Prada confirmed it has completed the acquisition after obtaining all necessary regulatory approvals. Capri Holdings plans to use proceeds from the sale to reduce its debt, with CEO John D. Idol stating that this would significantly improve the company’s financial standing. Earlier this year, Andrea Guerra, CEO of Prada, mentioned that Versace possesses significant growth potential, emphasizing the need for careful and patient execution in the brand’s future trajectory.
Source: https://www.bbc.com/news/articles/c3e05j9012vo?at_medium=RSS&at_campaign=rss