The Italian group Prada studies the purchase of Versace

The Italian group Prada is considering the purchase of the fashion group Versace from the American multinational Capri Holdings, also the owner of the brands Jimmy Choo and Michael Kors, as reported on Friday by the Italian newspaper Il Sole 24 Ore. The company led by Andrea Guerra and Patrizio Bertelli is evaluating the operation with the advice of the investment bank Citi, while the selling party has enlisted Barclays to search for potential buyers.

Versace, founded in the late seventies by Gianni Versace in Milan, has been owned since 2018 by the Capri Holdings group, which reportedly has decided to divest itself of this iconic brand, as well as Jimmy Choo, according to market sources cited by the Italian newspaper. In addition to Prada, other fashion groups and especially private equity funds would be interested in acquiring this iconic haute couture house, whose value is still being discussed. Prada, for its part, has not commented on the matter.

This is not the first time that the American luxury conglomerate Capri Holdings has considered selling Versace. A year ago, the investment company Exor, controlled by the Agnelli family, and Kering, the French multinational specializing in luxury goods, explored the operation. In fact, Prada itself already showed interest in the brand seven years ago.

In September 2018, when the American group acquired the brand from the Versace family and the American investment firm Blackstone, they spent a total of $2.12 billion (1.8 billion euros). However, the worldwide drop in luxury demand is hindering the growth of the fashion house, whose performance has deteriorated in recent times. In the second quarter of the fiscal year 2024, it generated $201 million in revenue, a 28% decrease compared to the same period last year, with an operating loss of three million.

Crisis in the luxury sector

The attempt to sell Versace comes after the failed merger between Capri Holdings and Tapestry

At the same time as other groups are trying to acquire Versace, the current owner of the brand, Capri Holdings, is seeking alternative ways to boost the value of the company. The most recent attempt was the failed merger with the American multinational Tapestry, an operation that was temporarily halted by the Federal Court of New York in October due to the risk of monopoly. A month later, both companies agreed to mutually terminate the merger agreement due to regulatory obstacles.