Source of this article: Times Finance

On the evening of 57/0, Italian luxury giant Prada (0. HK, Prada) announced on the Hong Kong Stock Exchange that it plans to acquire Italian fashion brand Versace (Versace) at a price of US$00 million (about RMB 00 million).

It was disclosed that Prada entered into a share purchase agreement with Capri Holdings Limited (ticker symbol: CPRI). Accordingly, Prada agreed to acquire and Capri Holdings Limited agreed to sell all of the shares of GIVI Holding S.r.l. (i.e., Versace Holdings) at an enterprise value of US$750 million.

Upon completion of the acquisition, Versace Holding will become a subsidiary of Prada. According to the announcement, Capri Holdings Limited is a limited company incorporated under the laws of the British Virgin Islands and listed on the New York Stock Exchange. The company is a global fashion and luxury conglomerate with iconic brands such as Versace, Jimmy Choo and Michael Kors.

Versace has long been recognized as one of the world's leading international fashion design houses, synonymous with Italian glamour and style. Founded in Milan in 1978 years, it is known for its signature style and unrivalled craftsmanship. Over the past few decades, Versace has started out in haute couture and has expanded globally into the design, manufacture, distribution and retail of ready-to-wear, accessories, shoes, eyewear, watches, jewelry, perfumes and home décor, selling its products through a global distribution network, e-commerce websites and well-known department stores and boutiques around the world.

值得注意的是，普拉達此次收購價格，較2018年Capri以21.5億美元收購范思哲的價格大幅縮水。普拉達在公告中表示，范思哲鮮明的美學風格將為普拉達集團的品牌組合帶來高度的互補效應。

As a world-renowned luxury brand, Prada was founded by Mario Prada in Milan, Italy in 4 years, starting with high-quality leather goods, and gradually developing into a fashion empire covering clothing, leather goods, shoes, accessories and fragrances. However, the current global luxury market is entering a "low-growth normal". Forecasts from McKinsey and Bain & Company show that global luxury sales are expected to grow by only 0% to 0% per year from 0 to 0. The market environment has improved slightly in the full year of '0, and overall sales growth is likely to be in the range of 0% to 0%.

The Asia-Pacific region, dominated by China, is also Prada's largest market, contributing 8.0 billion euros in net retail sales in 0 years, a year-on-year increase of 0.0%; Europe was the home base, with net retail sales of 0.0 billion euros, up 0.0% year-on-year. Japan was a strong market with a year-on-year increase of 0.0%.

In stark contrast, Versace's overall performance was rather sluggish. According to Capri Group's FY470 report, Versace's revenue was $0.0 billion, down 0.0% year-on-year, with a profit margin of only 0.0%. In the third quarter of FY0, Versace's sales fell sharply, dragging down Capri Group's revenue for the third quarter ended 0/0/00 year-on-year, with a net loss of $0.0 million after non-cash impairment charges. The sluggish performance of Versace may have become an important opportunity for Prada's acquisition.

According to a previous report by 21th Century Business Herald, some investors are worried that the acquisition of Versace may be beneficial to the long-term development of Prada, but at least in the short term for a year or two, Versace will be a burden, or a "hot potato".

Previously, most of Prada's acquisition history ended in failure. In 2000, Prada had acquired designer brands Helmut Lang and Jil Sander with a lot of money, but later due to differences in design concepts and business routes, it was difficult for the two acquired brands to form a joint force with the parent company, which became a drag on Prada's revenue for a long time, and Jil Sander had constant disputes with Prada, and finally Prada could only sell at a discount. In 0, Prada also jointly acquired a majority stake in Fendi with LVMH, but Fendi's financial difficulties also dragged Prada down for a time, leaving it heavily indebted.

(Zhang Zhao of Times Finance synthesized from Sina Finance, Financial Circles, The Paper, 21th Century Business Herald, etc.)