USA TODAY International Edition
Michael Kors pays $2.1B for Versace, will add 100 stores
Luxury goods maker Michael Kors Holdings reached a deal to acquire Italian fashion house Gianni Versace in a move aimed at giving the combined company further runway for growth. Michael Kors, whose products include clothes, accessories, shoes, jewelry and eyewear, said Tuesday that it would pay about $2.1 billion for Versace. The company said it would subsequently rename itself Capri Holdings, taking its new moniker from “the fabled island which has long been recognized as an iconic, glamorous and luxury destination.” The deal will enable the luxury goods company to open about 100 new stores throughout the world, up from about 200 today, and expand online sales. “For over 40 years, Versace has represented the epitome of Italian fashion luxury, a testament to the brand’s timeless heritage,” Michael Kors CEO John D. Idol said in a statement. “We are excited to have Versace as part of our family of luxury brands, and we are committed to investing in its growth. Donatella Versace, whose brother Gianni was murdered in 1997, will stay at the creative helm of the Italian brand. Michael Kors said it expects to help Versace grow to $2 billion in annual sales and for the combined company to reach $8 billion in annual revenue. “There is a clear intent to grow the Versace business through both stores and online,” wrote Neil Saunders, managing director of GlobalData Retail. “Over recent years, Michael Kors has done a good job of developing new store concepts that have resonated with shoppers. We believe that this expertise can be put to good use in the Versace business.” The move comes after Michael Kors in 2017 acquired luxury shoe company Jimmy Choo, extending a period of consolidation for the luxury goods market. Luxury retailer and rival Coach acquired handbag and accessories maker Kate Spade in 2017 and then renamed itself Tapestry.