NEW DELHI: Italian powerhouse Prada announced Thursday it will acquire flamboyant rival Versace from US-based Capri Holdings in a €1.25 billion (over Rs 12,000 crore) deal, a move poised to reshape the balance of power in high fashion.
The deal, set to close in the second half of 2025, creates an Italian luxury giant with revenues exceeding €6 billion — a bold challenge to French behemoths like LVMH and Kering, amid a global slowdown in luxury spending.
“We are delighted to welcome Versace to the Prada Group,” said Patrizio Bertelli, Prada’s executive director and long-time helmsperson of the brand. “We share a strong commitment to creativity, craftsmanship, and heritage.”
A fire sale and a farewellThe acquisition comes at a discount. Capri Holdings, which acquired Versace for €1.83 billion in 2018, had to accept a reduced offer from Prada due to weakened sales and Trump-era tariffs that dented valuations.
Adding to the intrigue, Donatella Versace — who took over the house after the tragic murder of her brother Gianni in 1997 — stepped down as creative director on April 1, paving the way for the deal. Donatella, now 69, will serve as the label’s chief brand ambassador.
Her replacement, Dario Vitale, is the force behind the rise of Prada’s edgy younger sibling, Miu Miu — signaling a potential pivot for Versace from glitz to Gen Z.
Contrasting worlds collideThe merger brings together two distinct worlds: Versace’s opulent, baroque aesthetic and Prada’s cerebral minimalism. Prada insists it won’t erase Versace’s DNA but will instead enhance it with “industrial capabilities and operational expertise.”
Yet analysts warn of a delicate balancing act.
“This is a risky move,” said Luca Solca, luxury analyst at Bernstein. “Prada may become distracted from its core business, as happened with earlier acquisitions like Jil Sander and Helmut Lang.”
Aiming for a renaissanceVersace’s third-quarter revenue in fiscal 2025 fell 15 percent to $193 million, a far cry from Prada’s soaring performance. Under the guidance of creative director Miuccia Prada and CEO Andrea Guerra, Prada posted a 25 percent jump in net profit in 2024, reaching €839 million, with revenue climbing to €5.4 billion.
Guerra acknowledged the task ahead: “The journey will be long and will require disciplined execution. Versace has huge potential — but evolution takes time.”
Turning the tables on FranceThe acquisition is more than a financial move — it’s a statement of intent. In recent years, French conglomerates have scooped up Italy’s brightest stars: Gucci, Fendi, Bottega Veneta. With this deal, Prada flips the script.
“Prada will be able to bring light back into a brand that was dying and infuse it with new life,” said design consultant Antonio Bandini Conti.
Whether the strategy pays off remains to be seen. But in a world where fashion loves a comeback, Prada is betting that Versace’s next chapter — wrapped in minimalist luxury and turbocharged by Milanese precision — could be its boldest yet.