Michael Kors buys Versace in $2.1bn deal

Michael Kors buys Versace in $2.1bn deal

Donatella Versace to stay on at Italian label and US fashion group to rebrand as Capri. Versace has been sold to the US clothing and handbags group Michael Kors for $2.1bn (£1.64bn) in the latest example of a family-owned European brand taken under the control of a global fashion conglomerate.

Michael Kors, which last year bought London shoemaker Jimmy Choo for almost £900m, confirmed on Tuesday that it had bought Versace and would fold all three brands into a new company called Capri Holdings – named after the favourite holiday island of wealthy fashionistas. The deal will cement the fortunes of the heirs of Gianni Versace, the designer who founded the label 40 years ago and built its reputation by dressing some of the world’s most glamorous women, including Princess Diana, Demi Moore and Elizabeth Hurley.

The family owns 80% of the business, with Gianni Versace’s niece Allegra Versace Beck, 32, holding a 40% stake worth €732m (£654m). Allegra’s mother and Gianni’s sister, Donatella Versace, holding 16%, and Gianni’s older brother Santo owning 24%.Donatella Versace, 63, who is Versace’s vice-president and artistic director, has committed to stay on at Capri Holdings and “lead the company’s creative vision”.

“This is a very exciting moment for Versace,” she said. “It has been more than 20 years since I took over the company along with my brother Santo and daughter Allegra. I am proud that Versace remains very strong in both fashion and modern culture. Versace is not only synonymous with its iconic and unmistakable style, but with being inclusive and embracing of diversity, as well as empowering people to express themselves.”

John Idol, chairman and chief executive of Michael Kors, said buying Versace was an important milestone for the US company and that creating a “family of luxury brands” would deliver shareholders “multiple years of revenue and earnings [profits] growth”.