Michael Kors Acquires Versace for $2.12 Billion

Michael Kors To Purchase Versace for $2.12 Billion USD

The deal between Michael Kors and Versace is officially in the works. With an estimated enterprise value of $2.12 billion USD. The news came Tuesday, September 25 and the deal is worth 2.5 times more than the brand’s current revenue. Furthermore, about 22 times more than its earnings before interest, taxes, depreciation and amortisation (EBITDA).

Business of Fashion reports that a majority of the deal is a cash one, with 150 million euros in stock, and is part of Kors plan to build a portfolio of high-end luxury brands. The move comes after it acquired Jimmy Choo for $1.2 billion USD and as they move into building a portfolio to rival LVMH and Kering.

Michael Kors will purchase Versace according to recent reports. Italian newspaper Courier della Serra reports, Donatella Versace called a staff meeting today to shed light on when the official announcement would be made. Versace declined to comment on the report to Paper Magazine.

The brand will likely sell to Michael Kors or jeweller Tiffany & Co, with a value price of $2 billion USD. The brand had previously sold a 20% stake in 2014 to US private equity group Blackstone.