Michael Kors Is Buying Versace for $2 Billion

Fashion Week surprises usually tend to be focused around designers leaving their posts or assuming new ones, but this season, changes are happening at the highest level at two of the most well-known fashion houses. Michael Kors has announced that it's set to acquire Versace for approximately $2.12 billion, Business of Fashion reports. The sale is expected to close in late 2019.

Though it may seem like a surprising pairing, it's part of a larger, ongoing effort on Kors' part to build a U.S.-based luxury powerhouse, like a stateside version of LVMH (the conglomerate that owns Louis Vuitton, Fendi, Christian Dior, among others) or Kering (parent company of Gucci, Alexander McQueen, Balenciaga, and more). Last summer, the company bought Jimmy Choo for $1.2 billion, according to the New York Times. With this acquisition, it competes with Tapestry (owner of Coach, Kate Spade New York, and Stuart Weitzman) and PVH Corp. (which operates Calvin Klein and Tommy Hilfiger.)

With Versace under its belt, Michael Kors Holdings Limited will be renamed Capri Holdings, a reference to "the fabled island which has long been recognized as an iconic, glamorous, and luxury destination," according to a statement provided to Glamour. Jonathan Akeroyd and Donatella Versace will remain chief executive and creative director of Versace, respectively. Santo, Donatella's brother, and Allegra, her daughter, will have a stake in Capri—which, the designer said,"demonstrates our belief in the long-term success of Versace and commitment to this new global fashion luxury group."

"The acquisition of Versace is an important milestone for our group," John Idol, chief executive officer of Michael Kors, told Bloomberg. "We are committed to investing in its growth."

Capri Holdings' plan for Versace is to grow its retail business (from 200 to 300 stores globally), expand its e-commerce, and increase its accessories and footwear business (from its current 35 percent to 60 percent), per Business of Fashion. So fans of the Italian brand's aesthetic needn't worry: The rococo-meets-'90s look that has made its most recent collections Instagram sensations will remain, with Donatella still at the helm. "Donatella’s iconic style is at the heart of the design aesthetic of Versace. She will continue to lead the company’s creative vision," Idol said. "I am thrilled to have the opportunity to work with Donatella on Versace’s next chapter of growth.” (In 2017, Gianni Versace SpA reported 686 million euros in revenue and a return to profit, according to Bloomberg.)

Still, the public has strong opinions about the news.

Versace hasn't returned Glamour's request for comment.

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