Prada Acquires Versace in $1.36 Billion Deal
The acquisition of Versace by Prada marks a significant shift in the luxury fashion landscape, creating a new powerhouse in the industry and setting the stage for increased competition among high-end fashion brands.
Prada has agreed to buy Versace in a $1.36 billion deal, uniting two of Italy's biggest fashion brands and creating a multi-billion dollar luxury fashion group, rivaling LVMH and Kering.
The acquisition creates a new Italian fashion powerhouse with revenues of over six billion euros, and Prada chairman Patrizio Bertelli aims to continue Versace's legacy. The deal comes as Versace has been operating at a loss due to a slowdown in demand for luxury fashion. Prada has acquired Versace for 1.25 billion euros ($1.38 billion) in a deal that will help Prada compete with giants like LVMH and Kering.
The acquisition will be funded through 1.5 billion euros of new debt and is expected to close in the second half of 2025. Prada plans to maintain Versace's creative DNA and cultural authenticity, and not revolutionize the brand. The deal bucks the trend of recent years, where Italian fashion labels have been acquired by French competitors.
However, analysts warn that Prada may become distracted from its core business. The reduced price of the deal, down by $200m due to the impact of President Trump's tariffs on the US fashion industry, reflects the challenges faced by the luxury fashion industry in recent times.