In September 2018, the fashion world was buzzing with the news that Michael Kors had acquired Versace for a whopping $2.1 billion. The announcement sent shockwaves through the industry, as it marked one of the largest deals in fashion history. Let’s take a closer look at how this acquisition came to be.
What Led to the Acquisition?
Michael Kors Holdings Limited, a global fashion luxury group, had been on a buying spree for some time. In 2017, they acquired luxury shoe brand Jimmy Choo for $1.2 billion. This acquisition was part of their strategy to expand their product offerings and move beyond just handbags and accessories.
The acquisition of Versace was seen as another step towards this goal. The Italian luxury brand was known for its bold designs and iconic prints, which would complement Michael Kors’ more classic style. Furthermore, Versace had a strong presence in Europe and Asia, which would help Michael Kors expand its global reach.
The Details of the Acquisition
The deal between Michael Kors and Versace was finalized on September 25th, 2018. Under the terms of the agreement, Michael Kors Holdings Limited changed its name to Capri Holdings Limited. Donatella Versace, sister of founder Gianni Versace and current artistic director of the brand, continued to lead the creative side of the business.
The acquisition also included two other brands under the Versace Group: Jimmy Choo and Michael Kors itself. This created a multi-brand fashion conglomerate with an estimated value of $8 billion.
The Reaction to the Acquisition
The reaction to Michael Kors’ acquisition of Versace was mixed. Some industry experts saw it as a smart move that would help both brands grow and succeed in an increasingly crowded market. Others were skeptical that Michael Kors could maintain the integrity and uniqueness of the Versace brand.
Despite these concerns, Capri Holdings Limited has seen success since the acquisition. In 2019, the company reported a revenue increase of 12.6%, with Versace being one of its strongest performers. The brand’s bold designs and iconic prints continue to resonate with consumers around the world.
In Conclusion
The acquisition of Versace by Michael Kors Holdings Limited (now Capri Holdings Limited) marked a significant moment in fashion history. With a price tag of $2.1 billion, it was one of the largest deals in fashion history and created a multi-brand fashion conglomerate worth an estimated $8 billion.
While there were initial concerns about how Michael Kors would integrate Versace into its portfolio, the brand has continued to thrive under Donatella Versace’s leadership. Today, it remains one of the most iconic luxury brands in the world.