Prada finalizes purchase of fashion rival Versace for $1.4 billion, launching new era

MILAN AP The Prada Group closed the purchase of Milan fashion rival Versace in a billion cash deal that puts the fashion house known for its sexy silhouettes under the same roof as Prada s ugly chic aesthetic and Miu Miu s youth-driven appeal The highly anticipated deal is expected to relaunch Versace s fortunes after middling post-pandemic performance as part of the U S luxury group Capri Holdings Prada mentioned in a one-line announcement that the acquisition had been completed after receiving all regulatory clearances Capri Holdings which owns Michael Kors and Jimmy Choo disclosed the money would be used to pay down debt Donatella Versace welcomed the deal in an Instagram post which also marked the birthday of the brand s late founder her brother Gianni Versace In the present day is your day and the day Versace joins the Prada family I am thinking of the smile you would have had on your face she wrote in a post that also featured a photo of Gianni Versace with Miuccia Prada Versace s future Prada heir Lorenzo Bertelli is set to steer Versace s next phase as executive chairman in addition to his roles as group marketing director and sustainability chief The son of co-creative director Miuccia Prada and longtime Prada Group chairman Patrizio Bertelli has explained he doesn t expect to make any swift executive changes at Versace although he also noted that the company which is among the top majority of recognized brands in the world has long been underperforming in the field Prada has underlined that the -year-old Versace brand offered substantial untapped expansion promising The appeal of the deal is that it combines the minimalist Prada with a maximalist Versace stated Luca Solca an analyst at Bernstein Group consulting firm meaning that the brands don t compete for the same customers Versace is long past its heydey Solca stated The challenge and the opportunity is to make it relevant again They are going to have to invent something which is going to make the brand attractive desirable and gripping again Versace already has begun a creative relaunch under a new designer Dario Vitale who previewed his first collection during Milan Fashion Week in September He was previously head of design at Miu Miu but his move to Versace was unrelated to the Prada deal executives have explained The runway show received mixed reviews but the collection itself a colorful revealing riff on the s got good feedback from buyers I think that this seems to be a promising first step Solca explained Latest from the past Capri Holdings paid billion for Versace in but had been struggling to position the brands bold profile in the new era of quiet luxury Capri Holdings chairman John D Idol revealed in a declaration that Prada is the ideal partner to guide this celebrated luxury house into its next era of development Versace represented of Capri Holdings revenue of billion euros Prada disclosed when the deal was declared in April that Versace would represent of the Prada Group s pro-forma revenues with Miu Miu coming in at and Prada at The Prada Group which also includes Church s footwear revealed a boost in revenues to billion euros last year Prada s in-house manufacturing The Prada Group has already begun preparations to incorporate crosstown rival Versace into its Italian manufacturing system a point of pride for the group Making a bag for one brand or another the know-how is the same Bertelli informed reporters last week at the group s Scandicci leather goods factory which already makes bags for the Prada and Miu Miu brands and will soon add Versace Artisans stitched handles onto leather bags and cut leather with laser machines inside the leather goods factory where trainees were learning the exchange as part of Prada s -year-old academy It has trained specific new artisans in an in-house training operation in the Tuscany Marche Veneto and Umbria regions Last year Prada hired of the artisans who trained in the academy The number of trainees rose by to this year The Prada Group has invested million euros in its supply chain this year including a new leather goods factory near Siena a new knitwear factory near Perugia as well as increasing production at its Church s footwear factory in Britain and expanding another Tuscan factory That s on top of million euros in investments from -