The US luxury group Michael Kors (KORS) confirms the deal of buying the Italian high-end Fashion House Versace with the enterprise value of 1,8 billion euros. According to Kors, the deal will be financed primarily with cash and the deal is expected to close in the fourth quarter of the fiscal 2019.
According to the deal, Kors is planning to increase the global presence of Versace and increase the brand stores to 300 from 200. The new revenue target is 2 billion dollars and the operational focus is to increase the men and women´s accessories and footwear to 60 % of the revenues from current 35 % level.
Michael Kors Holdings will change its name to Capri Holdings and the company expects to increase the total revenues of the three major brands (Michael Kors, Jimmy Choo and Versace) to 8 billion dollars in the long run. Now the pro forma annual sales is 6 billion dollars and the group has over 1200 stores globally.