Prada Acquires Versace in $1.38 Billion Deal
Deal News | Apr 13, 2025 | EIN
Prada has completed a significant acquisition of Versace for $1.375 billion, including debt, marking a strategic expansion in the luxury fashion industry. Despite the economic instability and concerns about U.S. tariffs impacting markets, Prada proceeded with acquiring the iconic Italian brand from Capri Holdings. The deal aims to enhance Italy's reputation in the global luxury market, challenging French conglomerates' dominance. As part of the acquisition, Donatella Versace steps down from her role as chief creative officer. The $1.38 billion purchase price is notably lower than the $2.15 billion Capri Holdings paid in 2018, highlighting market-driven financial considerations. The transaction is anticipated to conclude in the latter half of 2025, financed by $1.5 billion in new debt by Prada. This move highlights Prada's shift in strategy, boosting its global footprint and competition in the luxury sector, with significant backing from its leadership team.
Sectors
- Luxury Fashion
- Mergers and Acquisitions
Geography
- Italy – Both Prada and Versace are iconic Italian fashion brands, and the acquisition underscores Italy's influence in the global luxury market.
- United States – The acquisition was affected by uncertainties surrounding U.S. tariffs, highlighting the global implications of American economic policies.
Industry
- Luxury Fashion – The article involves prominent luxury fashion houses, Prada and Versace, focusing on their merger to expand market share within the global luxury fashion sector.
- Mergers and Acquisitions – The article centers on Prada's acquisition of Versace, an M&A transaction aimed at strategic growth and sector consolidation.
Financials
- $1.375 billion – The acquisition price paid by Prada for Versace, inclusive of debt.
- $2.15 billion – The amount Capri Holdings originally paid for Versace in 2018, indicating a discounted current sale price.
- 1.5 billion – The new debt Prada is committing to finance the acquisition of Versace.
- 9 percent – The decline in Capri Holdings' shares following the acquisition announcement.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| Prada | Bidding Company | Company | An Italian luxury fashion house that has completed the acquisition of Versace to enhance its brand and market presence. |
| Versace | Target Company | Company | A renowned Italian luxury fashion brand acquired by Prada as part of its expansion strategy. |
| Capri Holdings | Selling Company | Company | The former owner of Versace, which sold the brand to refocus on its core businesses like Michael Kors and Jimmy Choo. |
| Donatella Versace | Former Chief Creative Officer | Person | The iconic designer who has been instrumental in shaping the Versace brand, stepping down as part of the acquisition. |
| Patrizio Bertelli | Chairman of Prada | Person | Chairman of Prada who is overseeing the strategic acquisition of Versace. |
| Andrea Guerra | CEO of Prada | Person | Current CEO playing a pivotal role in strategizing and executing Prada's acquisition of Versace. |
| Lorenzo Bertelli | Future Leader | Person | Expected to play an increasing leadership role at Prada, potentially taking over the company in the future. |