The Prada Group has finalized its acquisition of Versace, a major deal in the luxury fashion industry. This move aims to revitalize Versace's performance and combine its glamour with Prada's unique aesthetic. The deal is expected to leverage Versace's potential for growth, with Lorenzo Bertelli leading the brand's next phase.
The Prada Group has completed its $1.375 billion takeover of Milan rival Versace , uniting the fashion house’s high-octane glamour with Prada ’s "ugly chic’’ aesthetic in one of the luxury sector’s biggest deals of the year.
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 said in a one-line statement that the acquisition had been completed after receiving all regulatory clearances. Capri Holdings, which owns Michael Kors and Jimmy Choo, said 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."Today 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 1996 photo of Gianni Versace with Miuccia Prada.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 said he doesn’t expect to make any swift executive changes at Versace, although he also noted that the company, which is among the top 10 most recognized brands in the world, has long been underperforming in the market.Prada has underlined that the 47-year-old Versace brand offered "significant untapped growth potential.’’The appeal of the deal is that it combines "the minimalist Prada a maximalist Versace," said Luca Solca, managing director for the luxury sector at the Sanford C. Bernstein research firm, meaning that the brands don't compete for the same customers.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 said.Capri Holdings paid $2 billion for Versace in 2018, but had been struggling to position the brands’ bold profile in the recent era of "quiet luxury.″Capri Holdings chairman John D. Idol said in a statement that "Prada is the ideal partner to guide this celebrated luxury house into its next era of growth.''Versace represented 20% of Capri Holdings’ 2024 revenue of 5.2 billion euros.Prada said when the deal was announced in April that Versace would represent 13% of the Prada Group’s pro-forma revenues, with Miu Miu coming in at 22% and Prada at 64%. The Prada Group, which also includes Church’s footwear, reported a 17% boost in revenues to 5.4 billion euros last year.The Prada Group has already begun preparations to incorporate crosstown rival Versace into its Italian manufacturing system, a point of pride for the group.Artisans stitched handles onto leather bags, and cut leather with laser machines inside the leather goods factory, where trainees were learning the trade as part of Prada's 25-year-old academy. It has trained some 570 new artisans in an in-house training program in the Tuscany, Marche, Veneto and Umbria regions.The Prada Group has invested 60 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 200 million euros in investments from 2019-24.
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