Prada takes over the fashion rival Versace in $1.37 billion deal

On Tuesday, The Prada Group announced that it has completed the purchase of luxury fashion house Versace in a deal valued at $1.37 billion. This brings two of Italy’s most powerful labels under the same umbrella. As the acquisition is finalised, Versace joins Prada and Miu Miu, bringing the end of Versace’s six-year run under US-based Capri Holdings. The proceeds from the sale will be used to pay off most of its debt.

As per Capri Holdings CEO John D. Idol, the sale "significantly reduces the company’s debt load and improves its leverage ratio." He added that now Capri will be focusing on growing its remaining brands, which are Michael Kors and Jimmy Choo. They also expect the business to stabilise this year and get back to growth by FY27.

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Challenging time for Versace

As per reports, Versace has struggled in the last two years as luxury spending has grown weak post-pandemic. Capri’s financial disclosures indicate that the brand faced challenges to match expectations in early 2025, despite its good performance in the couple of years post-COVID-19.

According to analysts, the flamboyant, high-glamour design codes that once made Versace a cultural force became at odds with the global shift toward "quiet luxury."

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As reported by IANS, analysts state that Prada’s stewardship is expected to help Versace with manufacturing and pricing, global distribution networks, long-term capital planning, and brand discipline and scalability. Prada said in a brief filing that the deal has all the needed approvals and is now fully complete, with only routine post-deal processes remaining.

Lorenzo Bertelli to take over Versace

Prada heir Lorenzo Bertelli, who is the group’s marketing director and sustainability chief at present, will take over as Executive Chairman of Versace. He has hinted that there is no plan to bring immediate changes but has acknowledged Versace’s long-standing underperformance. The group has emphasised that Versace holds "significant untapped growth potential."

Versace is already in a creative transformation under designer Dario Vitale, whose first runway collection debuted at Milan Fashion Week in September.

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Speaking at the group’s Scandicci leather goods factory, Bertelli said, "Making a bag for one brand or another - the know-how is the same." Alongside Prada and Miu Miu, the factory will now add Versace. The group is also investing in supply chain expansion, which includes a new leather goods facility near Siena, a knitwear centre near Perugia, and the expansion of Church’s footwear production in the UK. As per reports, the group has trained 570 artisans in 25 years through its in-house academy, hiring 70% of its 2024 trainees.

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Designer Donatella Versace celebrated the acquisition by sharing a vintage photo of Gianni Versace, as the day also marks the birthday of the brand’s late founder. "Today is your day and the day Versace joins the Prada family. I am thinking of the smile you would have had on your face," she wrote on Instagram.

Reportedly, Versace contributed 20% of Capri Holdings’ 2024 revenue, while Prada expects it to represent 13% of its pro-forma revenue. The Prada Group, including Church’s, showed 17% revenue growth last year.