Prada Weighs Bid for Versace as Luxury Sector Consolidation Continues
Milan-based Prada is evaluating a potential acquisition of Versace, owned by Capri Holdings, according to individuals familiar with the matter. The move comes amid Prada's strong performance in the luxury sector and Versace's recent financial challenges.
Prada has commenced a comprehensive review of Versace's financials and sales data. Capri Holdings shares experienced a surge of 7.5% in premarket trading on Wednesday in New York.
Versace's third-quarter revenue declined 15% year-over-year to $193 million, accompanied by an operating loss of $21 million.
A successful acquisition would mark the return of Versace to Italian ownership after several other Italian fashion brands have been acquired by global conglomerates.
LVMH, Kering, and L Catterton have acquired or invested in renowned Italian brands such as Fendi, Moncler, Gucci, Bottega Veneta, and Valentino. Prada, a family-owned company listed in Hong Kong, has emerged as a standout performer during the luxury sector downturn, with its Miu Miu brand gaining traction among younger consumers.
Capri Holdings, which also owns Michael Kors, has reportedly enlisted Barclays Plc to explore options for its controlled companies, including Versace. The potential transaction follows the failed $8.5 billion merger attempt with Tapestry Inc.
Exclusive due diligence on Versace has been granted to Prada, as per The Platform, an Italian news website.