U.S. luxury goods company Tapestry is acquiring Capri Holding for a total of $8.5 billion. The deal brings Tapestry’s brands, including Kate Spade and Stuart Weitzman, and Capri’s Jimmy Choo and Versace labels under one roof. The two companies have annual sales of more than $12 billion and adjusted operating profits of nearly $2 billion. Capri shareholders are being offered $57 per share by Tapestry – a premium of nearly 65 percent over the previous day’s closing price. Capri’s shares were trading at $54.90 in pre-market trading on Wall Street. The merger will also bring a $200 million reduction in ongoing costs over three years, according to Chief Financial Officer Scott Roe. The transaction is expected to close in 2024.
Tapestry – then known as Coach – acquired handbag maker Kate Spade in 2017 for $2.4 billion. That same year, Capri, formerly known as Michael Kors, acquired British shoe maker Jimmy Choo for $1.2 billion and a year later bought Versace for $2.2 billion.
The merger of the U.S. luxury brands is expected to give the company more power, as it is lagging behind the European luxury groups, above all LVMH, which owns 75 brands. Kering also recently made its presence felt by acquiring a 30 percent stake in the Valentino fashion label.