Milan, Italy – Prada, the Italian luxury fashion giant under Prada Holding S.p.A., has successfully acquired its rival Versace from Capri Holdings in a deal that has swirled the fashion industry for a couple of years.
The acquisition was completed after Prada received all required regulatory approvals, bringing the two fashion houses together and expanding the group’s portfolio.
Capri Holdings revealed that the sale goes for $1.375 billion in cash, subject to certain adjustments, a price some consider a “discount” given it is well below the roughly $2 billion that Capri paid for the brand in 2018.
Reuters reported that Prada first signed a definitive agreement in April to buy Versace from Capri Holdings for about 1.3 billion euros ($1.51 billion), after Capri’s planned sale to Tapestry was scrapped following antitrust challenges.
According to the Aberdeen & Grampian Chamber of Commerce, Capri, which still owns brands including Michael Kors and Jimmy Choo, will use the money received to repay its debts and “substantially strengthen” its balance sheet.
Lorenzo Bertelli, the son of Prada owners Miuccia Prada and Patrizio Bertelli, told Reuters in November that he will become executive chairman of Versace once the integration is complete. He said that Prada had been keen on a deal for several years.
“There had already been contacts during the COVID period; there were talks even before Capri’s sale to Tapestry. When that deal fell through over antitrust issues, we came back and tried to speed things up,” Lorenzo Bertelli said, as quoted by Reuters.
Bertelli also emphasised that the deal had “been in the works for a long time.” Bertelli, who strongly pushed for the acquisition, said Versace met two key conditions: that it was not too risky financially and that it was worth it, given the brand ranks among the world’s leaders in terms of awareness.
It is worth noting that storied designer and iconic fashion icon Donatella Versace, who served as the brand’s creative chief, stepped down in March this year after 27 years in the company, a move that shook the industry. She was then replaced by Miu Miu’s Dario Vitale.
