Prada agrees to buy Versace for $1.4 billion

The Prada Group announced a deal Thursday to buy crosstown Milan fashion rival Versace from the U.S. luxury group Capri Holdings under terms that values one of the most recognizable names in Italian fashion at $1.4 billion.

The deal will put Versace, known for sexy silhouettes and bold Greco and Medusa motifs, under the same roof as Prada’s “ugly chic” aesthetic and the youth-driven Miu Miu whose stunning growth in recent years has far outpaced the market. Prada said the 47-year-old Versace brand offered “significant untapped growth potential.’’

“This is exactly the strength for our group. There are no overlaps in terms of creativity, in terms of customer,″ said Lorenzo Bertelli, Prada’s chief marketing officer, who is being groomed to one day take over the business that his parents — Miuccia Prada, the group’s creative force and largest shareholder, and Patrizio Bertelli, its chairman and executive director — have turned into a global fashion juggernaut.

The final value of the deal will be adjusted at closing, which is expected in the second half of the year, the Prada Group said. It will be funded by 1.5 billion euros in new debt and has been approved by the Prada and Capri Holdings board of directors.

Capri Holdings, which owns Michael Kors and Jimmy Choo, paid $2 billion for Versace in 2018, but had been struggling to position Versace’s bold profile in the recent era of “quiet luxury.″

Versace represented 20% of Capri Holdings 2024 revenue of 5.2 billion euros. An analyst presentation for the Prada deal said that Versace would represent 13% of the Prada Group’s pro-forma revenues, with Miu Miu coming in at 22% and Prada at 64%. The Prada Group, which also includes Church’s footwear, reported a 17% boost in revenues to 5.4 billion euros last year.



(AP Photo Vincent Yu)