Prada has taken a bold step to expand its luxury empire, announcing on Tuesday that it has acquired fellow Italian fashion house Versace for $1.38bn (£1.04bn) — a
steep discount from the nearly $2bn paid by its former owner Capri Holdings in 2018.
The move brings two of Italy’s most recognisable designer labels under one corporate roof, strengthening Prada’s hand as it vies with French giants such as LVMH, the owner of Louis Vuitton, Dior and Fendi. Prada already controls the youth-oriented label Miu Miu, giving the group a wider footprint in the global luxury market.
The sale comes after a turbulent period for Versace. Despite its storied heritage — defined by bold glamour and the famous Medusa emblem — the brand has struggled in recent years. Under Capri Holdings, Versace shifted towards a more minimalist aesthetic while raising prices, a strategy that failed to reverse slowing sales across the group, which also owns Michael Kors and Jimmy Choo. The result is a sale at a loss of roughly $700m.
The transition also coincides with the departure of Donatella Versace, who stepped down as creative chief in March after nearly three decades leading the house she took over following the 1997 murder of her brother, founder Gianni Versace. She has been succeeded by Dario Vitale, previously a design director at Miu Miu.
Prada confirmed the deal’s completion in a brief statement, noting that it had received all necessary regulatory approvals. Capri Holdings said proceeds from the sale will be used to significantly reduce debt, with chief executive John D. Idol stating the move would “substantially strengthen our balance sheet.”
Prada chief executive Andrea Guerra has described Versace as a brand with “huge potential,” while cautioning that its turnaround will require patience and disciplined execution.
As the two luxury houses begin their new chapter together, the industry now watches to see how Prada will revive one of fashion’s most iconic names — and what comes next for Donatella Versace. Photo by Guilhem Vellut, Wikimedia commons.