Michael Kors to buy British luxury brand Jimmy Choo
A store of shoe designer Jimmy Choo is seen in the mountain resort of St. Moritz, Switzerland
US retail giant Michael Kors is set to buy Jimmy Choo for $1.2 billion
US retail giantMichael Kors is set to buy Jimmy Choo, which was put up on sale in April. The deal is worth $1.2 billion. Jimmy Choo had put itself up for sale after its major shareholder JAB decided to focus on consumer goods.
The British firm is a renowned brand for shoes, handbags and other accessories. It was co-founded by Malaysian shoemaker Jimmy Choo and Tamara Mellon in 1996. The brand became a big hitamong musicians, actresses and royalty. The brandwas made famous by Princess Diana. It wasalso embraced by singer Beyonce and Oscar winning actress Emma Stone.
The luxury brand, however, was struggling with slow sales for some time.
JAB Holdings, the investment vehicle of Germany's billionaire Reimann family, backed the sale plan. JAB has been drifting away from the luxury sector which it considers "non-core".
Michael Korssaid the deal would benefit Jimmy Choo by increasing its sale to one billion. It added that the brand will have greater product diversification by expanding into the men's luxury footwear category. It will also benefit from the greater exposure to the global market. Michael Kors is eyeing thefast growing Asian market.
Michael Kors, once a very popular brand in affordable luxury and handbags, has been struggling due to declining sales. To overcome this it has expanded into dresses and menswear and invested in its online business.
The firm is not going to alter the existing Jimmy Choo business, it said. Jimmy Choo will continue to work with the existing management team.