Michael Kors Holdings Ltd, renamed to Capri Holdings, is set to strengthen its brand portfolio by acquiring Versace. On Tuesday, the American conglomerate announced that it has purchased the iconic Italian fashion house for approximately US $2.12 billion dollars.
“The acquisition of Versace is an important milestone for our group. For over 40 years, Versace has represented the epitome of Italian fashion luxury, a testament to the brand’s timeless heritage. We are excited to have Versace as part of our family of luxury brands, and we are committed to investing in its growth,” said John D. Idol, Chairman and Chief Executive Officer of Michael Kors Holdings Limited in an official statement.
Rumors of the acquisition first surfaced on Monday, when multiple outlets including Bloomberg and The Wall Street Journal reported that Michael Kors is on the cusp of closing a deal with the iconic Italian luxury label for a whopping US $2.3 billion dollars. The transaction is expected to close in the last quarter of 2019.
Now that Michael Kors has acquired the brand, the Versace family— including Donatella Versace, who became the house’s creative director after her brother Gianni’s murder in 1997— will no longer have ownership of its namesake label. Currently, they own 80% of the company, while the other 20% belongs to the US private-equity firm Blackstone Group, which acquired the stake in 2014. Donatella will remain the creative director of the company, as well as a shareholder in Capri Holdings.
“Donatella’s iconic style is at the heart of the design aesthetic of Versace,” Idol remarked. “She will continue to lead the company’s creative vision. I am thrilled to have the opportunity to work with Donatella on Versace’s next chapter of growth.”
In the same statement, Donatella added: “We are all very excited to join a group led by John Idol, whom I have always admired as a visionary as well as a strong and passionate leader. We believe that being part of this group is essential to Versace’s long-term success. My passion has never been stronger. This is the perfect time for our company, which puts creativity and innovation at the core of all of its actions, to grow.”
Versace joins luxury shoe label Jimmy Choo, which was acquired by Michael Kors last year for US $1.2 billion dollars. Alongside Tapestry Inc. (formerly known as Coach), Michael Kors is vying to strengthen its foothold in the luxury fashion space by building a multi-brand fashion empire that could rival that of Paris-based conglomerates LVMH and Kering.
Versace has been having quite the year, starting with Donatella’s touching, supermodel-filled Spring 2018 runway tribute to her late brother last September. Since then, the luxury Italian label has unveiled a collaboration with Kith and pledged to go completely fur-free. Meanwhile, Donatella Versace joined Anna Wintour, Rihanna, and Amal Clooney in co-hosting the 2018 Met Gala and was honored with the International Award by the CFDA. Additionally, The Assassination of Gianni Versace: American Crime Story has just scooped the 2018 Emmy for Outstanding Limited Series.
There has been a surge of luxury brand consolidation in recent months. In August, Ermenegildo Zegna acquired an 85% stake in Thom Browne. Spanish luxury group Puig acquired a majority stake in Dries Van Noten in June, and in May, Richemont (Cartier, Monteblanc) purchased luxury E-commerce platform Net-a-Porter.