Prada will buy Versace for EU€1.25 billion (A$2.254 billion), uniting two of the largest Italian fashion houses.
Versace is currently owned by Capri Holdings, which also owns Jimmy Choo and Michael Kors. The company has posted significant losses in revenue in recent months.
“We aim to continue Versace’s legacy celebrating and re-interpreting its bold and timeless aesthetic; at the same time, we will provide it with a strong platform, reinforced by years of ongoing investments and rooted in longstanding relationships,” said Prada Group chair Patrizio Bertelli.
“Over the last six years, we have made tremendous progress in repositioning the brand [Versace] to place greater emphasis on its luxury heritage and exceptional craftsmanship,” said Capri Holdings CEO John Idol. “Through elevated product, marketing and store enhancements, the brand is now well positioned for sustainable long-term growth.”
The deal is expected to close in the second half of 2025, and will be funded by EU€1.5 billion in new debt.
While Versace’s purchase price was previously set at EU€1.43 billion, Prada reportedly negotiated a discount following the United States’ introduction of sweeping tariffs last week.
Capri had initially requested EU€3 billion for Versace, which it bought for €1.83 billion in 2018. Tapestry, owner of Kate Spade and Coach, bid US$8.5 billion to acquire Capri in 2024, though this was blocked by the U.S. Federal Trade Commission.
Versace’s revenue fell by 15% year-over-year last quarter to US$193 million. The brand posted revenue declines in the Americas, Europe and the Middle East, and Asia, and saw an operating loss of $21 million.
Capri Holdings’ overall revenue dropped by 11.4% in constant currency last quarter, with Jimmy Choo and Michael Kors also reporting losses.
Capri’s (NYSE: CPRI) share price closed at US$14.63, down from its previous close at $16.36. Its market capitalisation is $1.73 billion.
Prada’s (SEHK: 1913) share price closed at HK$47.85, up from its previous close at $45.60. Its market capitalisation is $122.4 billion.
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