Michael Kors is buying Versace for $2 billion

Marco Green
September 25, 2018

Once the transaction closes, the company will change its name to Capri Holdings Ltd. and trade under the symbol CPRI.

Earlier, in 2017, Kors expanded his business by acquiring Jimmy Choo for about $1.2 billion.

In 2016, Versace poached Alexander McQueen's boss Jonathan Akeroyd to help it smarten up for a stock market listing, although that never materialised.

"We believe that the strength of the Michael Kors and Jimmy Choo brands, and the acquisition of Versace, position us to deliver multiple years of revenue and earnings growth", John Idol, chairman and CEO of Michael Kors said.

Donatella Versace, artistic director and vice-president of the Italian group, said the takeover was "essential to Versace's long-term success".

Michael Kors also outlined plans to increase the number of Versace retail stores worldwide from 200 to 300 and push the share of revenues raised from accessories and footwear from 35% to 60%. Founded in 1978, it has been majority-owned by members of the Versace family since its inception.

While Donatella Versace announced the deal saying, "This is a very exciting moment for Versace".

Versace was one of the few Italian fashion companies to remain independent, until now. Versace is not only synonymous with its iconic and unmistakable style, but with being inclusive and embracing of diversity, as well as empowering people to express themselves.

Mr Idol said the company was committed to investing in Versace's growth, with a goal to grow revenues to more than £2bn (£1.5bn).

The 1.83 billion euro deal was hotly anticipated and adds the Italian brand's maximalist sensibility to its portfolio, which includes Michael Kors as well as Jimmy Choo, which was acquired for $1.2 billion a year ago.

Michael Kors, whose namesake label is best known for its leather handbags, has made no secret of its ambition to grow its portfolio of high-end brands after buying British stiletto-heel maker Jimmy Choo for $1.2 billion a year ago.

She holds a 20 per cent stake in the company, her daughter Allegra has a 50 per cent stake, while Santo, Donatella's brother, holds the remaining 30 per cent.

Versace is now 80% controlled by the late designer's family, with private equity firm Blackstone holding a 20% stake.

Other reports by Click Lancashire

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