Michael Kors to buy Versace in $2 billion deal

Baku, September 24, AZERTAC

Italian fashion house Versace could announce its sale to U.S.-based fashion group Michael Kors this week, with a deal potentially valuing the Milan-based brand at about $2 billion, according to multiple media reports.

Sources familiar with the deal spoke anonymously to Bloomberg and Reuters, with the latter describing the decision as finalized.

Donatella Versace, the brand's artistic director, called for a staff meeting Tuesday tied to the sale, both outlets reported. She has helped lead the company with brother Santo Versace, its chairman, since the 1997 murder of their sibling Gianni, the company's founder.

The Versace family owns 80 percent of the company, per the reports, and would stay on board as part of the deal. Blackstone, an American private equity group, owns 20 percent and would fully exit.

The potential deal comes as U.S.-based fashion companies increasingly look to compete in the European-dominated industry, Reuters noted.

The New York-based owner of Coach purchased another handbag company, Kate Spade, last year for $2.4 billion.

A purchase of Versace offers Kors a globally watched label that posted sales well north of $700 million last year.

Kors, also known for high-end bags, purchased luxury stiletto maker Jimmy Choo last year for roughly $1.3 billion, citing opportunities to expand into Asia. That move highlighted the shaky retail sector for luxury brands, which have experienced rapid change in recent years.

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