Editor’s Note
The proposed $8.5 billion acquisition of Capri Holdings by Tapestry marks a significant consolidation in the fashion industry, creating a new American powerhouse to rival European luxury groups.
Tapestry, the parent company of Coach, is acquiring Capri Holdings, which owns fashion brands including Michael Kors, Versace, and Jimmy Choo. The acquisition is valued at approximately $8.5 billion. This move signifies an American fashion house’s strategy to amass a portfolio of iconic brands to compete with European luxury conglomerates like LVMH and Kering.
On August 10 (local time), Tapestry, which also owns Kate Spade and Stuart Weitzman, announced that the combined entity would have annual global revenues exceeding $12 billion and operate in over 75 countries. The company expects to achieve cost synergies of about $200 million within three years and plans to finance a significant portion of the acquisition through debt.
The deal comes amid significant consolidation in the global luxury sector. Last month, Kering, owner of Gucci, announced it would acquire a stake in Valentino from Qatari investment fund Mayhoola for €1.7 billion, with an option for full ownership by 2028. Kering had also been in a bidding war for Tom Ford last year, which was ultimately acquired by Estée Lauder for over $2 billion.
Meanwhile, LVMH, which acquired Tiffany & Co. in 2021, currently oversees about 60 subsidiaries and manages 75 renowned brands.
The boards of both Tapestry and Capri have approved the transaction, which is expected to close next year. Following the announcement, Capri’s stock surged more than 58% in pre-market trading on Thursday, while Tapestry’s shares fell by 3%.
