Prada announced a landmark deal to acquire rival Italian fashion house Versace from Capri Holdings, worth $1.375 billion, including assumed debt.
The move was confirmed on Thursday, April 10, marking a major consolidation in the Italian luxury fashion industry and having a greater influence in the market traditionally dominated by French conglomerates.
This acquisition is in the fate of comparing the two fashion giants. Versace is struggling with economic losses despite Prada’s recent slowdown in luxury demand. Under the guidance of one of Italy’s most prominent luxury players, the merger will provide Versace with a new life lease.
The deal comes as an announcement on March 13 that Donatella Versace will resign as chief creative officer, ending the brand era founded by her late brother Gianni Versace. The departure sets the stage for new chapters in the evolution of the tag.
“Our goal is to continue to celebrate and reinterpret its legacy of bold and stellar aesthetics,” said Prada Chairman Patrizio Bertelli, who stressed that Prada will provide a platform to support the scope of years of strategic investment and ingrained industry relations. Bertelli, along with his wife and iconic designer Miuccia Prada, is a major shareholder in Prada.
The agreed price is a significant price cut paid by Capri Holdings (formerly Michael Kors) for Versace in 2018. At that time, Capri acquired the brand from the Versace family and private equity firm Blackstone.
Prada’s minimalist design spirit will now be complemented by Versace’s iconic baroque style and bold prints, expanding the company’s reach to new customer segments.
“Versace has great potential. The journey will be long and requires disciplined execution and patience.
The acquisition is taking place during a period of wider uncertainty in the global market. New U.S. tariffs have triggered some planned mergers, acquisitions and IPOs due to stock market volatility and recession issues, which have been put on hold recently.
It is worth noting that Prada has largely avoided major acquisitions in recent decades after Bertelli’s “strategic mistake” in purchasing Helmut Lang and Jil Sander in the late 1990s. This latest move marks a significant return for the deal, potentially reshaping the high-end fashion landscape in Europe and beyond.
