Michael Kors Holdings LTD confirmed earlier reports on Tuesday that it will be purchasing all outstanding shares from Versace for nearly $2.1 billion. The company also announced that the group will officially be labeled Capri Holdings Limited, named after the island of Capri, which Michael Kors refers to as an “iconic, glamourous destination.”
The renaming of the group comes with no surprise as the company realizes by keeping its original name it may confuse customers who are uncapable of separating the brand from the holding company, similar to Coach Inc. when that group decided to rename itself as Tapestry. As for Donatella Versace, she will be staying in position as creative director of the house. Versace will also be a shareholder within the new group, along with her brother Santo and daughter Allegra. Versace CEO Jonathan Akeroyd will remain with the company, too.
“This demonstrates our belief in the long-term success of Versace and commitment to this new global fashion luxury group,” Donatella said in a statement.
John D. Idol, chairman and CEO of Capri Holdings Limited, acknowledged the Italian brand’s history and future prospects 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. With the full resources of our group, we believe that Versace will grow to over US$2.0 billion in revenues,” he said.
Michael Kors Holdings LTD currently already owns Jimmy Choo, but according to sources, the company is working up a deal to purchase Gianni Versace SpA that values at $2.35 billion. The two parties are set to later announce the deal, which could come as early as this week, according to sources.
Forbes noted that the Versace family continued to be the majority owners in the company since its inception, with private equity firm Blackstone Group who holds a 20% stake. The brand has had a momentous 12 months, which started with Donatella Versace’s Instagram-worthy tribute collection last September during Milan Fashion Week. It was a tribute intended for her late brother Gianni, who originally designed the collections before his sudden death in 1997. A no-fur policy was also implemented company-wide this year, marking a totally new approach to the brand. Michael Kors also announced last year that they too, would be going “fur-free,” which makes the Versace acquisition all the better as the two brands hold similar values. There is no doubt that Michael Kors Holdings see great potential in capitalizing on Versace’s momentum and high-profile globally.