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Capri Holdings, which owns the Versace, Michael Kors and Jimmy Choo brands, has put the Versace fashion house up for sale. Italian fashion giant Prada is among the potential buyers.
This was reported by Reuters with reference to its sources, reports delo.ua
Capri Holdings, listed on the US stock exchange, is facing a sales slump in the $400 billion global luxury market, driven by a slowdown in Chinese consumer spending and the end of a long economic boom.
In November 2024, Tapestry, the owner of the Coach brand, backed out of a deal to buy Capri for $8,5 billion. After that, the management of Capri decided to consider the possibility of selling its brands. For this, Barclays was involved, which is studying various strategic options, including the sale of Versace and Jimmy Choo.
Stakeholders include private equity firms and competitors in the luxury sector.
Reuters sources also said that the entire Capri Holdings group could be put up for sale.
Prada, which previously partnered with Citi, is currently exploring the possibility of a deal. However, analysts are skeptical of this prospect, citing differences between brands. Versace is known for its bright, maximalist aesthetic, while Prada gravitates towards minimalism.
How much does Versace cost?
Versace's value is estimated at $1,75 to $2,19 billion (excluding debt). However, the brand is facing financial difficulties, with revenue falling to $2024 billion in 1,03 and operating margin falling to 2,4% from 13,7% a year earlier.
Analysts also point to challenges Prada could face following a potential acquisition, including:
- The need to reorganize distribution and reduce wholesale sales.
- Modernization of Versace aesthetics.
Prada CEO Andrea Guerra said in May that the company is not planning large-scale acquisitions and is focused on developing its brands.
With this in mind, experts doubt Prada's real interest in a deal with Versace, noting that the likelihood of an offer remains low.
Founded in Milan in 1978 by Gianni Versace, Versace remains a symbol of luxury with recognizable prints and the Medusa motif. However, the brand faces serious challenges, which makes it difficult to find a new owner.
