Michael Kors To Acquire Versace For $2bn

The Italian luxury fashion brand, Versace, is set to be acquired by Michael Kors, the American handbag maker, in a deal that is reportedly worth as much as $2bn (£1.5bn).

The takeover would be part of the attempts of Michael Kors to establish an American rival to giant European luxury holding firms such as Kering, Richemont, nd LVMH after it splurged £896m on Jimmy Choo, the London-based shoe maker, in 2017..

Versace sells flamboyant £1,500 pinstripe suits and £2,000 handbags. It is one of the few remaining independent luxury houses. It is 80 percent owned by the family of Gianni Versace, its founder.

Blackstone, the US private equity giant, stands to net a profit on the deal after acquiring a 20 percent stake in the firm for €210m (£188m) in 2014.

The possibility of a deal emerged last Monday when Corriere della Serra, an Italian newspaper, reported that some US firms, including Tiffany & Co and Michael Kors were interested in Versace. Tapestr, the owner of Coach owner and PVH the owner of Tommy Hilfiger and Calvin Klein were also revealed to be interested in the firm.

The Financial Times revealed that Michael Kors had emerged as the winner of the bidding and was set to announce the deal as soon as Tuesday morning.

A spokesperson for Versace refused to comment on the matter, while Michael Kors did not answer to requests for comment.

Reportedly, the takeover coems after aborted plans to float Versace on a stock market earlier in 2018.

Gianni Versace started the brand in Milan way back in 1978. He was shot to death at the age of 50 on the steps of his Miami mansion in 1997 by Andrew Cunanan. The killer was reportedly obsessed with the designer. He took his own life the following week.

Currently, Donatella, Mr Versace’s sister, is the creative director of the company and their brother Santo serves as its chairman. Jonathan Akeroyd, the former Alexander McQueen boss, joined the firm to serve as its chief executive two years ago.

Reportedly, the family plans to continue their involvement with the business, should the takeover continue.

The Jimmy Choo deal helped Michael Kors to raise its revenues by 5 percent to $4.7bn (£3.57bn) and its profits by 7.5pc to $592m in 2017. That dwarfs Versace’s 2017 turnover of €686m (£616m).