Fashion company Tapestry Inc., known for its brands Coach and Kate Spade, has announced its agreement to acquire Capri Holdings Ltd., the parent company of Michael Kors, Jimmy Choo, and Versace. This all-cash deal is valued at $8.5 billion.

The Deal

Under the terms of the board-approved deal, Tapestry will pay $57 per Capri share, which represents a premium of approximately 59% over the 30-day volume weighted average price ending on Wednesday. This acquisition is expected to have an immediate positive impact on Tapestry’s adjusted per-share earnings and generate significant cash flow.

A Powerful Luxury House

The combination of Coach, Kate Spade, and Stuart Weitzman with Versace, Jimmy Choo, and Michael Kors creates a new and powerful global luxury house. Tapestry’s CEO, Joanne Crevoiserat, expressed excitement about the opportunity to drive enhanced value for consumers, employees, communities, and shareholders around the world.

Closing and Market Reaction

The deal is projected to be finalized by the end of the calendar year 2024. Following the news, Capri shares surged with a 58% increase during premarket trading.

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