Michael Kors to take control of Italy's Versace

Sean Reid
September 25, 2018

Donatella Versace, sister of late founder Gianni who doubles as artistic director and vice-president of the Milan-based group, has called a staff meeting for Tuesday, according to a person who was briefed by a company employee. Michael Kors and private equity firm Blackstone, which owns 20% of Versace, did not immediately respond to a request for comment.

The move is in line with the USA brand's ambition to aggregate various luxury brands - including fashion, shoes and accessories - under one larger group. Last year, Kors acquired the Jimmy Choo business for $1.2 billion.

According to Punch, Corriere della Sera, one of Italy's biggest newspapers, shared the news.


Michael Kors is reportedly set to acquire Versace for roughly $2 billion, according to Reuters and sources close to the situation. However, Versace has struggled to grow sales, despite a luxury-fashion boom led by Chinese consumers.

Michael Kors could not be reached for comment. The shares have recovered since then, trading 15 percent higher for the year, with Choo boosting the latest quarterly results.

Versace, known for its flamboyant style and Medusa-head logo, hired chief executive officer Jonathan Akeroyd in 2016 from Alexander McQueen.


But word that a deal is close sent Kors shares down nearly 9 per cent to as low as US$66.33 in NY on Monday, the biggest intraday drop since May 30.

Versace had planned to float the company on the stock market but put the plans on hold owing to unfavourable conditions.

She holds a 20 per cent stake in the company, her daughter Allegra has a 50 per cent stake, while Santo, Donatella's brother, holds the remaining 30 per cent.


Versace does not disclose its financial details, but documents deposited with the Italian chamber of commerce show that a year ago it posted sales of 668 million euros (US$786 million) and earnings before interest, tax, depreciation and appreciation (EBITDA) of 44.6 million euros. The 40-year-old fashion house returned to profit in 2017 and reported revenue of almost $800 million. She closed the collection by walking the runway herself, arm-in-arm with 1990s models including Carla Bruni and Cindy Crawford.

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