$2.1 Billion is the price tag Michael Kors has put out and paid to buy the luxury Italian fashion brand Versace. Michael Kors is an American based lifestyle brand centered around the modern woman. Kors is most noted for his ready to wear designs, more specifically through accessories such as handbags. His designs are staples of American fashion history and his brand is distinguishable as well as a household name. Versace, as stated previously, is a high-end brand centered and ran in Italy. The brand aesthetic of Versace is bold, seductive, and rock and roll Esq. The two brands are on completely opposite sides of the spectrum in the world of fashion and because of this both the general public and almost every media outlet has gone berserk over understanding the guidelines of the purchase.
Here’s the truth: this purchase has the capability to change the international fashion world completely. This is so because Michael Kors is the first American designer to own international companies thus far. In 2017 Kors bought the British brand Jimmy Choo and now after acquiring Versace he has created a newly named fashion house: Capri Holdings. Capri Holdings now houses Michael Kors, Jimmy Choo, and Versace under full control of Kors himself.
Now while ownership plays a huge role into these three companies, it does not overstep the boundary of the creative design, which is a HUGE concern of the general public over Versace’s buyout. Similar to the Jimmy Choo deal, Versace will still remain under the full control of its pivotal designer Donatella Versace. Considering that Versace is family owned the family will also remain full stakeholders of the company allowing them profit. This is essential information regarding the purchase as Michael Kors as a brand is seen in a completely different light than Versace regarding exclusivity and quite frankly originality. The brands will not merge leaving them to their own distinctions and thus allowing them similar profits if not an increase which is what’s desired from this deal.
The creation of Capri Holdings is in place to benefit every company it holds. The cold truth regarding finances is that though Versace is a luxury brand with pieces priced at $ 1000+, it functions more off creativity rather than internal funding. Versace has in fact always been family owned but not always particularly family funded. Kors through Capri Holdings offers Versace the opportunity to focus primarily on the design aspect of fashion rather than the business side. The projected outcome of this deal is to focus on promoting the sales of Versace’s accessories (an area of expertise to Kors) as well as to increase Versace’s worth as a brand in monetary increments of billions.
The future of this deal is highly dependent on what the collision can truly believe that is beneficial to the companies and their consumers. The delivery of the guidelines of the deal has the capability to strengthen or dismantle the standing of the newly found Capri Holdings. The near future that will showcase collections, stock prices, and statistics of success will truly show what Capri Holdings will provide the world after its big move of powering the iconic Medusa head under MK.