Italian powerhouse Prada has acquired rival Versace from Capri Holdings for 1.25 billion euros ($1.39 billion).
Announced on Thursday, this landmark deal unites two iconic Milan-based brands, creating a luxury group with combined annual revenues exceeding 6 billion euros.
The acquisition positions Prada to strengthen its foothold in the competitive luxury market, rivaling industry titans like France’s LVMH and Kering.
The move comes as the global luxury sector grapples with a persistent slowdown, driving fashion houses to pursue strategic mergers to sustain growth and market dominance.
Prada’s chairman and executive director, Patrizio Bertelli, hailed the acquisition as a pivotal moment, stating, “We are delighted to welcome Versace to the Prada Group and to build a new chapter for a brand with which we share a strong commitment to creativity, craftsmanship, and heritage.”
This alliance aims to leverage the complementary strengths of both brands to navigate an increasingly challenging economic landscape.
Versace’s path to this acquisition reflects a dynamic history. In 2018, Capri Holdings parent company of Jimmy Choo and Michael Kors purchased Versace for 1.83 billion euros ($2.1 billion at the time).
Before that, the brand was 80% owned by the Versace family and 20% by U.S. investment firm BlackRock.
However, declining sales in recent years prompted Capri to put the label up for sale, culminating in exclusive negotiations with Prada that began in late February.
Financial Negotiations and Market Pressures
The deal’s financial terms underscore the complexities of the current market. Initially, Versace’s sale price was projected at $1.6 billion, according to The Financial Times.
However, economic turbulence intensified by U.S. President Donald Trump’s tariffs forced Capri Holdings to accept a reduced offer of 1.25 billion euros from Prada.
This price adjustment highlights the broader uncertainties impacting the luxury fashion industry, from trade policies to shifting consumer demand.
Adding intrigue to the acquisition, Donatella Versace stepped down as creative director last month after over three decades at the helm. She assumed the role in 1997 following the tragic murder of her brother, Gianni Versace, who founded the brand in 1978.
On April 1, she was succeeded by Dario Vitale, a proven leader credited with driving remarkable sales growth at Miu Miu, Prada’s youth-oriented sister brand.
This leadership shift is widely viewed as a prelude to the Prada-Versace accord, setting the stage for a revitalized creative direction.
A New Chapter for Luxury Fashion
Prada’s acquisition of Versace marks a bold step toward reshaping the luxury fashion landscape. By combining their rich legacies and innovative visions, the two brands aim to fortify their positions against competitors like LVMH and Kering while addressing the sector’s ongoing challenges.
This deal signals a dynamic evolution for both Prada and Versace, promising a fusion of heritage and ambition in the ever-evolving world of high fashion.
