Coach owner buys out Versace owner for $8.5 billion – Kommersant
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Fashion house Tapestry Inc., which owns brands such as Coach, Kate Spade and Stuart Weitzman, announced about the purchase of Capri Holdings, which owns the Michael Kors, Jimmy Choo and Versace brands.
Tapestry will pay $57 in cash for each share of Capri, up 65% from the holding’s closing price on Wednesday. The total amount of the transaction will be about $8.5 billion.
At the end of last year, the combined sales of the two American luxury holdings amounted to $12 billion. If the deal closes, the combined company will operate under the Tapestry brand.
The holdings decided to merge in a difficult period for luxury manufacturers. Companies are reporting a drop in US sales this year as Americans seek to save money during a period of high inflation. Tapestry and Capri executives stressed that bringing the six brands together under one roof will expand the customer base while increasing production resources.
On the back of the announcement of the deal, Tapestry shares sank 13.5%, while Capri shares, by contrast, soared more than 56%.
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