Prada Buys Versace in $1.4 Billion Deal
In a landmark move for the fashion industry, Prada announced Thursday it has struck a deal to acquire iconic rival Versace from Capri Holdings for $1.375 billion, including debt. The acquisition brings together two of Italy’s most celebrated fashion houses and strengthens the country's position in a global luxury market largely dominated by French conglomerates like LVMH and Kering.
A Bold Bet on Italian Luxury
Prada, which has outperformed peers amid a broader slowdown in luxury demand, is aiming to scale its global presence and diversify its portfolio with this acquisition. Versace, known for its baroque prints and bold aesthetic, has been operating at a loss under Capri Holdings, which had purchased the brand in 2018 for $2.15 billion, including debt.
The newly announced price represents a steep discount compared to that deal, signaling both the challenges Versace has faced and the opportunity Prada sees ahead.
A New Era After Donatella
The announcement comes just weeks after Donatella Versace revealed she would step down as the brand’s chief creative officer, ending an era of family leadership that began with her brother Gianni, who founded the house in 1978. Her departure sets the stage for a full transition of creative and strategic control under Prada’s stewardship.
“We aim to continue Versace’s legacy, celebrating and re-interpreting its bold and timeless aesthetic,” said Prada Chairman Patrizio Bertelli, who leads the company alongside his wife, designer Miuccia Prada.
“At the same time, we will provide it with a strong platform, reinforced by years of ongoing investments and rooted in longstanding relationships,” Bertelli added.
Strategic Shift After Past Caution
The move marks a significant strategic shift for Prada. After calling its late-1990s acquisitions of Helmut Lang and Jil Sander “strategic mistakes,” the group had largely avoided major dealmaking for over two decades. The Versace deal signals a renewed appetite for bold moves, albeit with more discipline.
Prada CEO Andrea Guerra noted, “Versace has huge potential. The journey will be long and will require disciplined execution and patience.”
Weathering a Volatile Market
The acquisition comes at a time when many fashion M&A deals and IPOs have been put on hold due to global market volatility and economic uncertainty, fueled in part by newly introduced U.S. tariffs from President Donald Trump. Prada’s decision to move forward anyway underscores its confidence in long-term growth and the enduring appeal of Italian luxury.
Minimalism Meets Maximalism
Strategically, the merger pairs two stylistically opposite yet culturally powerful brands—Prada’s minimalist sophistication and Versace’s lavish, statement-making glamour. The combination could create crossover appeal, drawing new demographics and giving Prada access to a broader segment of global luxury consumers.
With Versace under its wing, Prada is not only doubling down on Italian design heritage but also positioning itself as a stronger contender in the global luxury fashion race—one increasingly shaped by consolidation, shifting tastes, and a volatile economy.
