Multinational fashion company, Capri Holdings Limited, on Monday announced that it completed the acquisition of Versace. It also announced that following the acquisition the company has decided to change its name from Michael Kors Holdings Limited to Capri Holdings Limited. Beginning January 2, 2019, its new NYSE ticker symbol will be CPRI.
With the acquisition of Versace, a brand synonymous to Italian glamour, style and fashion industry, Capri now operates three luxury brands -- namely, Versace, Jimmy Choo and Michael Kors with pro-forma revenue of $6 billion and 1,238 stores combined. The Versace addition to Capri’s portfolio, according to analysts, is expected to increase the mix of the company's European revenue to 24% from 18%.
According to the terms of the deal, Capri Holdings acquired Versace for a total enterprise value of 1.83 billion euro (or approximately US$ 2.12 billion). Capri funded the cash portion of the purchase through internal accruals and funded the rest via its revolving credit facility and bank term loans.
According to the Chairman and Chief Executive Officer of Capri Holdings, John D. Idol, the new name of the group is being inspired by the legendary ‘Capri’ island which has long been recognized as an iconic, glamorous and luxury destination. Capri’s spectacular three rock formation, formed over 200 million years ago, is symbolic of the timeless heritage and strong foundation that is at the core of each of the three founder-led brands.
According to John, this acquisition is expected help the group to further enhance its global presence and revenue, along with increasing its exposure to growing Asia region. The acquisition is expected to help grow the groups revenue by $ 8.0 billion over the long-term.