MICHAEL KORS BUYS VERSACE IN $2.12 BILLION DEAL
In a deal that no one saw coming, Michael Kors has confirmed the acquisition of Italian luxury fashion house Gianni Versace S.p.A. for a total enterprise value of Euro 1.83 billion or approximately US$2.12 billion.
Versace’s management team will continue to be led by chief executive officer Jonathan Akeroyd, who has been an instrumental partner to Donatella Versace in driving growth and success for Versace worldwide. Donatella will also remain in her role in leading the company’s creative vision.
Through this acquisition, Michael Kors plans to invest in Versace’s long-term growth, with its main goal to grow the brand’s revenues globally to be $2 billion annually. Michael Kors also plans to build on Versace’s luxury runway momentum, enhance the brand’s powerful and iconic marketing, increase its global retail footprint from approximately 200 to 300 stores, accelerate e-commerce and omni-channel development, and expand men’s and women’s accessories and footwear from 35 percent to 60 percent of revenues.
Upon closing this acquisition, Michael Kors Holdings Limited will adopt a new name, Capri Holdings Limited. The name is inspired by the fabled island which has long been recognized as an iconic, glamorous, and luxury destination. The island’s three rock formation, formed over 200 million years ago, is symbolic of the heritage and strong foundation that is at the core of each of the three founder-led brands (Michael Kors, Jimmy Choo, and Donatella Versace) in this new global fashion luxury group.
“The acquisition of Versace is an important milestone for our group,” said John D. Idol, chairman and chief executive officer of Michael Kors Holdings Limited. “Versace was founded in 1978. For over 40 years, Versace has represented the epitome of Italian fashion luxury, a testament to the brand’s timeless heritage. We are excited to have Versace as part of our family of luxury brands, and we are committed to investing in its growth. 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.”
“This is a very exciting moment for Versace,” said Donatella Versace. “It has been more than 20 years since I took over the company along with my brother Santo and daughter Allegra. I am proud that Versace remains very strong in both fashion and modern culture. Versace is not only synonymous with its iconic and unmistakable style, but with being inclusive and embracing of diversity, as well as empowering people to express themselves. Santo, Allegra and I recognize that this next step will allow Versace to reach its full potential. 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. We believe that being part of this group is essential to Versace’s long-term success. My passion has never been stronger. This is the perfect time for our company, which puts creativity and innovation at the core of all of its actions, to grow.”
Donatella added, “Santo, Allegra and I will become shareholders in Capri Holdings Limited. This demonstrates our belief in the long-term success of Versace and commitment to this new global fashion luxury group.”
