Prada Group says it has purchased fashion rival Versace in a deal worth nearly $1.4 billion

Milan — Prada Group announced Tuesday that it has officially bought Milan fashion rival Versace in a deal worth €1.25 billion (about $1.4 billion) that puts the fashion house known for its dramatic silhouettes under one roof with Prada’s “ugly chic” aesthetic and the youth-driven appeal of Miu Miu.

The highly anticipated deal is expected to relaunch Versace’s fortunes, following a mediocre post-pandemic performance as part of US luxury holding group Capri.

Prada said in a one-line statement that the acquisition has been completed after obtaining all regulatory approvals.

The future of Versace

Prada heir Lorenzo Bertelli will lead Versace’s next phase as CEO, in addition to his roles as group marketing director and chief sustainability officer.

The son of co-creative director Miuccia Prada and longtime Prada Group chairman Patrizio Bertelli said he does not expect any quick executive changes at Versace. But Bertelli said the company, which is among the world’s top 10 best-known brands, has long underperformed in the market.

Prada stressed that the 47-year-old Versace brand offers “significant untapped growth potential.”

Versace has been in the midst of a creative relaunch under new designer Dario Vitale, who showed off his first collection during Milan Fashion Week in September. He previously served as head of design at Miu Miu, but his move to Versace was unrelated to the Prada deal, executives said.

Capri Holdings, which owns Michael Kors and Jimmy Choo, paid $2 billion for Versace in 2018, but has been struggling to position Versace as bold in the recent era of “quiet luxury.”

Versace represented 20% of Capri Holdings’ 2024 revenues of 5.2 billion euros. One analyst said of the Prada deal that Versace would represent 13% of Prada Group’s initial revenues, with Miu Miu coming to 22% and Prada coming to 64%. The Prada Group, which also includes Church Shoes, reported a 17% increase in revenue to €5.4 billion last year.

Prada in-house manufacturing

The Prada Group has already begun preparations to integrate its rival Versace into the Italian manufacturing system, which is a point of pride for the group.

“Making a bag for one brand or another, the know-how is the same,” Bertelli told reporters last week at the group’s Scandicci leather goods factory, which already makes bags for Prada and Miu Miu.

Prada Group has invested €60 million in its supply chain this year, including a new leather goods factory near Siena, a new knitwear factory near Perugia, as well as increasing production at its Church shoe factory in Britain and expanding another Tuscan factory. This is in addition to €200 million of investments in the period 2019-24.

Prada’s efforts include an academy that has trained some 570 new craftsmen over the past 25 years in an in-house training academy operating in the regions of Tuscany, Marche, Veneto and Umbria.

Last year, Prada hired 70% of the 120 craftsmen who trained at the academy. The number of trainees increased by 28% to 152 this year.