News Update


Versace’s owner will be taken over in a $8.5 billion deal.

Tapestry, the luxury goods conglomerate, is buying Versace’s parent company for $8.5 billion (£6.7 billion).

Capri Holdings, which also owns Michael Kors and Jimmy Choo, is being acquired by Tapestry, which has its own high-end brands including as Coach.

Tapestry CEO Joanne Crevoiserat stated that the transaction “creates a new powerful global luxury house.”

Analysts predicted that it would establish a rival to fight with European fashion behemoths.

“It’s creating a major American fashion conglomerate, especially in the premium fashion space,” said Louise Deglise-Favre, a clothing expert at analytics firm GlobalData, to the BBC.

“It’s not as large as European behemoths like LVMH and Kering, but it’s definitely giving its brands a stronger footing,” she noted.

LVMH and Kering are both France-based luxury brand conglomerates that own some of the most recognizable names in luxury apparel, leather products, and jewelry. Kering owns brands such as Gucci, Yves Saint Laurent, and Balenciaga.

LVMH is the parent company of Louis Vuitton, Givenchy, Christian Dior, and Marc Jacobs.

While Versace has become a global icon of Italian luxury, companies such as Kate Spade and Michael Kors are considered as more affordable by some consumers, with smaller accessories starting at under £100.

Ms Deglise-Favre stated that the merger will boost Tapestry’s position in this market by uniting brands with comparable offerings, such as Coach, which has previously issued collaborations geared at younger buyers with pop singers such as Selena Gomez.

She did, however, warn that Tapestry is also inheriting Michael Kors, which has suffered from years of poor performance.

“That will be a significant challenge,” she remarked.

Tapestry, on the other hand, has a track record of turning around troubled businesses, notably Kate Spade, which it acquired in 2017.

The agreement comes at a time when inflation – the rate at which prices rise – is high in many nations, squeezing consumer spending.

Aspirational shoppers have been particularly hard affected in recent months, according to Ms Deglise-Favre, while enterprises must contend with increasing interest rates, wages, and supply chain concerns.

The transaction is expected to close in 2024.

According to Ms Crevoiserat, the move will allow the company to reach additional countries throughout the world.

It is the latest purchase in the premium fashion market, with Kering announcing in July that it would buy a 30% share in Italian fashion house Valentino.

Versace has been sold for the second time in five years. Following decades of ownership by the Versace family, Michael Kors purchased the Italian label for more than $2 billion in 2018.

At the time, Michael Kors reorganized Versace and Jimmy Choo, which it acquired in 2017, into a new firm called Capri Holdings.


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