36.5 C
Dubai
Sunday, September 24, 2023
spot_img

Coach owner acquiring Michael Kors, Versace parent for $8.5B

Tapestry, the parent company of Coach, is set to acquire Capri Holdings, which owns renowned fashion brands such as Michael Kors, Versace, and Jimmy Choo. This significant $8.5 billion deal marks a consolidation trend in the fashion industry, particularly as U.S. players aim to enhance their influence in the European market.

The merger positions Tapestry to directly compete with giants like LVMH and Kering. The combined entity, which also includes Kate Spade and Stuart Weitzman under Tapestry’s umbrella, boasts annual global sales exceeding $12 billion and a presence in over 75 countries.

With a market cap of approximately $10 billion for Tapestry and around $4 billion for Capri, the union will yield the fourth-largest luxury company globally, commanding about 5.1% of the luxury goods market, according to GlobalData PLC.

Upon finalization, the merged company will become the second-largest luxury player in the Americas after LVMH, possessing 6% of the luxury goods market share, as reported by GlobalData.

Tapestry CEO Joanne Crevoiserat stated, “The combination of Coach, Kate Spade, and Stuart Weitzman together with Versace, Jimmy Choo, and Michael Kors creates a new powerful global luxury house.”

Capri Holdings shareholders will receive $57.00 per share in cash. This strategic move by Tapestry holds potential to expand its global reach while maintaining the distinct identity of its brands, according to Capri Chairman and CEO John Idol.

This acquisition aligns with a trend of major luxury companies seeking to consolidate and expand internationally due to a slowdown in the luxury market, especially in North America.

Neil Saunders, Managing Director of GlobalData, highlighted that this move could lead to a significant influence on the luxury market.

The deal has received approval from both Tapestry and Capri boards and is expected to be finalized next year, pending approval from Capri shareholders. Following the announcement, Capri’s stock surged by 56%, while Tapestry’s shares experienced a decline of almost 12%.

Next Article

Related Articles

Airline warns shutdown; Indian aviation won’t intervene

India's aviation authorities have declined to intervene in the ongoing dispute between Akasa Air and its pilots. Over 40 of Akasa's 450 pilots resigned...

Former UK PM David Cameron at Port City Colombo UAE Roadshow

Port City Colombo to hold UAE Roadshow for global investors. Former UK PM David Cameron will discuss ties between the UAE, Indo-Pacific, and Sri...

“Game of Thrones” creator and authors sue OpenAI for copyright violation

John Grisham, Jodi Picoult, and George R.R. Martin, along with 14 other authors, are suing OpenAI for what they claim is "systematic theft on...

Watch: Dubai real estate agents queue for Palm Jebel Ali villa sales

Dubai's newest waterfront project, Palm Jebel Ali, has caused a significant stir. Hundreds of real estate agents and potential buyers formed long lines outside...

Indian rupee nears historic lows, faces more pressure.

The Indian rupee, near a record low, faces ongoing pressure due to factors like crude oil prices and the US Federal Reserve's policy decision....

Latest Articles