With Jimmy Choo, Michael Kors finds shoes to match its bags

LONDON (AP) — In a bid to burnish its brand image, American bag and accessories maker Michael Kors is buying luxury shoemaker Jimmy Choo in a deal worth US$1.35 billion.

Jimmy Choo, which counts Jennifer Lopez, Duchess of Cambridge Kate Middleton and Beyonce among its fans, has a high-level profile that tempted Michael Kors to pay a premium.

Michael Kors has struggled recently, announcing in May that it would close up to 125 stores due to weak sales.

It said that Jimmy Choo is “the ideal partner” and will have its online presence bolstered as a result of the deal. Jimmy Choo CEO Pierre Dennis and Creative Director Sandra Choi will remain in their jobs.

“Jimmy Choo is poised for meaningful growth in the future and we are committed to supporting the strong brand equity that Jimmy Choo has built,” said John Idol, CEO of Michael Kors.

Analysts said the deal could help Michael Kors rebuild its brand name, though that would happen in the longer-term and not have an immediate impact on the company’s stock.

“We believe the strategic steps Kors is making to elevate its own brand are working, and believe the addition of Jimmy Choo, an iconic premium luxury brand, should be beneficial,” the analysts said in a note to clients.

Shares in Jimmy Choo were up 17 per cent at $2.99 earlier this week, while Michael Kors was down 2.5 per cent at $34.