US fashion giant Michael Kors has confirmed a $2.1bn takeover of Versace, including debt, providing Kors an entry into the exclusive high-end European luxury market.
“Michael Kors, with roots in the United States but headquartered in London, has struck a deal to buy Versace for 1.83 billion euros ($2.1 billion),” a statement said.
“We are excited to have Versace as part of our family of luxury brands, and we are committed to investing in its growth,” said Michael Kors chief executive John D. Idol.
“With the full resources of our group, we believe that Versace will grow to over $2.0 billion in revenues,” he added.
“We believe that the strength of the Michael Kors and Jimmy Choo brands, and the acquisition of Versace, position us to deliver multiple years of revenue and earnings growth.”
Following the deal, Michael Kors will change its corporate name to Capri Holdings, in what it described as a nod to the “iconic, glamorous and luxury destination.”
Donatella Versace, artistic director and vice-president of the Italian group, said the takeover was “essential to Versace’s long-term success”.
Donatella has run Versace since the 1997 murder of her brother Gianni.
She called the sale a “very exciting moment” and “allow Versace to reach its full potential”.
She added in the statement: “We are all very excited to join a group led by John Idol, whom I have always admired as a visionary as well as a strong and passionate leader.”
“Donatella will continue to lead Versace’s “creative vision”, said Idol.
The purchase could help Michael Kors compete against rival fashion groups like Louis Vuitton owner LVMH (LVMHF) and Tapestry (TPR), the parent of Coach and Kate Spade.
Last year, Michael Kors bought London-based shoemaker Jimmy Choo for $1.2 billion