Michael Kors shares closed higher in the US Tuesday, after the US fashion house confirmed the acquisition of Versace. The $2.1 billion deal will see Donatella Versace remain with the iconic Italian fashion label.
The number of Versace stores are set to rise post purchase, while Michael Kors anticipates its turnover will double.
Michael Kors shares ended the Tuesday US session 1.95% higher at $68.01. The stock had been broadly steady until it sank Friday.
Michael Kors Versace deal
The purchase of Versace by Michael Kors was finally confirmed Tuesday, after much talk that the deal was on the cards.
“The acquisition of Versace is an important milestone for our group,” said Michael Kors Chairman and CEO, John D. Idol.
“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 $2.0 billion in revenues,” Idol added.
Idol also confirmed that Donatella Versace “will continue to lead the company’s creative vision,” adding that he’s “thrilled to have the opportunity to work with Donatella on Versace’s next chapter of growth.”
While the move may anger some Versace fans, the alignment with Michael Kors shouldn’t bring an end to the Italian fashion house’s iconic style.
Donatella Versace voiced her approval of the deal. “This is a very exciting moment for Versace,” she said.
“We believe that being part of this group is essential to Versace’s long-term success. My passion has never been stronger. This is the perfect time for our company, which puts creativity and innovation at the core of all of its actions, to grow,” Versace adds.
Versace’s current CEO, Jonathon Akeroyd will also remain in place, as part of the purchase.
Idol, meanwhile, said he plans to increase the number of Versace stores from the 200 level, to around 300. In addition, once the deal is confirmed, Versace’s online expansion will also be accelerated.