Prada is looking to expand in the face of a slump in luxury goods demand, while Versace is operating at a loss. The merger strengthens Italy's position in a luxury industry dominated by French conglomerates.
The deal followed the March 13 announcement that Donatella Versace was stepping down as chief creative director of the brand founded by her late brother Gianni.
“We aim to continue the legacy of Versace, celebrating and reimagining its bold and timeless aesthetic,” said Prada chairman Patrizio Bertelli.
“At the same time, we will provide it with a solid platform, backed by years of consistent investment and rooted in long-standing relationships,” added Bertelli, the husband of Prada designer Miuccia Prada. The couple are leading shareholders in the company.
The price Prada agreed to pay for Versace is significantly lower than the estimated $2.15 billion, including debt that Capri paid for Versace in 2018. Formerly known as Michael Kors, Capri bought Versace from the Versace family and Blackstone.
Source: Reuters
