Italy’s Prada is among the potential suitors eyeing fashion group Versace which Capri Holdings has put up for sale. This is as per reports by Italian newspaper II Sole 24 Ore, which said Prada is looking into the deal with banking firm Citi.
In November, Coach-owner Tapestry made the bold decision of abandoning an $8.5 billion deal to buy Michael Kors-owner Capri. After that deal to create a U.S. luxury conglomerate fell through, Capri executives did not rule out the possibility of a potential sale of its brands.
Even though the decision is yet to be explicitly confirmed by Capri itself, multiple media platforms have cited industry sources suggesting that the group was working with Barclays to find buyers for both Versace and Jimmy Choo.
While the sales format is still unclear to many, it has been speculated that Barclays is considering an auction that would require interested parties to submit offers over multiple rounds. Reuters has further reported that an entire sale of Capri is yet to be ruled out.
The future of Capri had been thrown into doubt earlier this year after an 8.5-billion-dollar merger with Tapestry had been blocked by an antitrust lawsuit by the Federal Trade Commission (FTC). Upon declaration of the decision, Capri shares dropped immensely in value and the merger deal was eventually terminated.
Contacted by Reuters, Prada declined to offer a comment on the same. Citi was not immediately available for comment. Prada’s Hong Kong- listed shares closed down 0.4% on Friday.
Versace, founded in Milan in 1978 by late Italian designer Gianni Versace and still led by his sister Donatella as creative director, became widely known for its bold, opulent prints, including the iconic Medusa motif.
Prada, whose rigorous, intellectual style carries the imprint of creative head Miuccia Prada, continues defying the industry’s downturn with sales up 18% at constant currencies in the third quarter.
In the fiscal year through Mar. 30, 2024, Versace accounted for a fifth of Capri’s revenue, about $1 billion out of a total of $5.2 billion for the group, which compared with $5.6 billion the year before. In November, Capri posted a bigger-than-expected drop in quarterly revenue, hurt by execution missteps and a global slowdown in luxury goods demand.
For now, it is only a matter of wait and see to see what will unfold in the coming days!