Michael Kors Holdings Ltd. (NYSE: KORS) announced early on Tuesday that it would be acquiring the Italian luxury fashion house Gianni Versace and adding it to its portfolio. The combined company will be changing its name following the acquisition.
Under the terms of the deal, Michael Kors will acquire Versace for a total enterprise value of €1.83 billion, or $2.12 billion.
As part of the strategic plan for the long-term growth of Versace, management set its goals as follows:
- Grow Versace to US$2.0 billion in revenues globally
- Build on Versace’s luxury runway momentum
- Enhance Versace’s powerful and iconic marketing
- Increase global retail footprint from approximately 200 to 300 stores
- Accelerate e-commerce and omni-channel development
- Expand men’s and women’s accessories and footwear from 35% to 60% of revenues
Capri Holdings will be the new name adopted by Michael Kors upon the closing of the acquisition. This name is inspired by the fabled island which has long been recognized as an iconic, glamorous and luxury destination. Shares will trade on the New York Stock Exchange under the ticker CPRI.
The Versace family will receive €150 million of the purchase price in shares of Capri Holdings. The transaction is expected to close in the company’s fourth fiscal quarter, subject to specified closing conditions, including the receipt of required regulatory approvals.
John D. Idol, board chair and chief executive of Michael Kors, commented:
The acquisition of Versace is an important milestone for our group. Versace was founded in 1978. For over 40 years, Versace has represented the epitome of Italian fashion luxury, a testament to the brand’s timeless heritage. We are excited to have Versace as part of our family of luxury brands, and we are committed to investing in its growth. With the full resources of our group, we believe that Versace will grow to over US$2.0 billion in revenues. We believe that the strength of the Michael Kors and Jimmy Choo brands, and the acquisition of Versace, position us to deliver multiple years of revenue and earnings growth.
Shares of Michael Kors were last seen trading at $66.69, with a consensus analyst price target of $77.35 and a 52-week range of $46.19 to $75.96.
24/7 Wall St.The Average American Is Losing Their Savings Every Day (Sponsor)
If you’re like many Americans and keep your money ‘safe’ in a checking or savings account, think again. The average yield on a savings account is a paltry .4% today, and inflation is much higher. Checking accounts are even worse.
Every day you don’t move to a high-yield savings account that beats inflation, you lose more and more value.
But there is good news. To win qualified customers, some accounts are paying 9-10x this national average. That’s an incredible way to keep your money safe, and get paid at the same time. Our top pick for high yield savings accounts includes other one time cash bonuses, and is FDIC insured.
Click here to see how much more you could be earning on your savings today. It takes just a few minutes and your money could be working for you.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
