Report: Michael Kors Could Bag Italian Fashion Label Versace In $2B Deal

In what would be a major shakeup in the fashion industry, Michael Kors Holdings Ltd KORS is reportedly close to buying Italian fashion house Versace.

What Happened

Michael Kors, which is on a buying spree and had purchased luxury shoemaker Jimmy Choo for $1.2 billion in 2017, is close to buying Versace in a deal that could be worth as much as $2 billion, according to several reports.

The first sniff of the news came from a report in Corriere della Sera, an Italian newspaper.

The deal could be confirmed as early as this week, according to Reuters, which cited unnamed sources familiar with the matter. 

Benzinga has contacted Kors for comment on this story. 

Versace is a family-owned company, founded by the late Gianni Versace in 1978, with the family still retaining 80-percent control. In 2014, Blackstone picked up a 20-percent stake in the company, and has been eyeing a public listing ever since, Reuters said. 

Why It's Important

The deal could help Michael Kors — known for its namesake luxury handbags — to become a multibrand fashion empire, rivalling European conglomerates such as LVMH Moet Hennessy Louis Vuitton SA Unsponsored ADR LVMUY and KERING S A/ADR PPRUY.

What's Next

According to the deal terms reportedly in the works, Blackstone would fully give up its stake in Versace, while its namesake family would continue to have a say in the running of the company.

The Reuters report cited a person  briefed by a company employee who said Versace's artistic director and Vice President Donatella Versace has called a staff meeting for Tuesday. 

Versace declined to comment on Reuters' story, the newswire said. 

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Photo by Bahar via Wikimedia.