The high-stakes consolidation of European luxury has entered a definitive new phase as the Prada Group officially completed its $1.375 billion acquisition of Versace from Capri Holdings in December 2025. This transaction effectively reverses the 2018 blockbuster deal where the American conglomerate, then known as Michael Kors Holdings, purchased the storied Italian maison for $2.1 billion. By returning the brand to its domestic roots, Prada Group is signaling a shift away from the ‘accessible luxury’ volume model toward a strategy of disciplined exclusivity. The acquisition follows the collapse of a proposed $8.5 billion merger between Tapestry and Capri Holdings, which was blocked by US regulators, leaving Capri to divest its ‘family silver’ to stabilize its balance sheet.
Financial reset and operational synergiets
With revenues rising by 15 per cent in 2024, Prada Group is leveraging its robust retail momentum to integrate Versace into its high-performance distribution network. For Capri Holdings, the sale serves as a critical deleveraging event, enabling the repayment of substantial debt following a fiscal year where Versace revenue dipped by 21 per cent. This acquisition provides Versace with a strong platform rooted in Italian craftsmanship, states Patrizio Bertelli, Chairman, Prada Group. The transition occurs as the personal luxury goods market is projected to reach $301 billion by 2026, driven by a 4.2 per cent compound annual growth rate.
Pioneering a phygital luxury future
Under new ownership, Versace is set to accelerate its digital transformation by integrating AI-driven personalized shopping and ‘Digital Product Passports’ to meet 2026 transparency mandates. By combining Miuccia Prada’s organizational rigor with Donatella Versace’s high-octane aesthetic, the group aims to capture the ‘Silver Spender’ demographic while simultaneously pivoting toward Gen Z consumers, who are expected to constitute 75 per cent of luxury buyers by the end of 2026. This strategic realignment prioritizes scarcity and heritage over mass-market penetration, marking a significant evolution in the global apparel landscape.
Prada Group is a dominant Italian luxury powerhouse managing iconic brands including Prada, Miu Miu, and Church’s. It specializes in high-end leather goods, ready-to-wear apparel, and footwear, primarily targeting affluent consumers in the Asia-Pacific, European, and North American markets.
