Versace is returning to Italian ownership.

Prada Group has agreed to buy the iconic fashion house from Capri Holdings for €1.25 billion, pending regulatory approval, the companies announced today.

“We are thrilled to welcome Versace to the Prada Group and to begin a new chapter for a brand that shares our dedication to creativity, craftsmanship, and heritage,” said Prada Group chairman and executive director Patrizio Bertelli. “Our goal is to honor Versace’s legacy while reinterpreting its bold, timeless aesthetic. With our strong platform and deep industry relationships, we are well-positioned to write the next chapter in Versace’s history.”

Capri—parent company of Michael Kors and Jimmy Choo—put Versace up for sale after its planned merger with Tapestry (owner of Coach, Kate Spade, and Stuart Weitzman) was blocked by the U.S. Federal Trade Commission last November. Since then, Capri has refocused on its core brand, Michael Kors, and is still seeking a buyer for Jimmy Choo. Capri (then called Michael Kors Holdings) originally acquired Versace in early 2019 for over $2.1 billion.

Versace joins Prada with a new creative director. On March 13, the brand announced that Donatella Versace would step down as chief creative officer after nearly 30 years at the helm—a role she took over following her brother Gianni Versace’s death in 1997. She will transition into a brand ambassador role. Dario Vitale, formerly design director at Prada-owned Miu Miu, has been appointed creative director—the first time the position has been held outside the Versace family.

Reports first emerged in January that Capri had hired Barclays to find buyers for Versace and Jimmy Choo. Other potential bidders, including ex-Gucci CEO Marco Bizzarri and Primavera Capital Group, were said to have shown interest. The sale of a storied brand like Versace is rare, fueling speculation about its future.

Now, as Prada takes over, the challenge will be revitalizing the brand. Versace’s revenue fell 15% to $193 million in Capri’s most recent quarter, with group sales down 11.6%. Capri had aimed to grow Versace into a $1.5 billion brand—can Prada achieve that?

Analysts say Versace needs a refresh. TD Cowen’s Oliver Chen recently noted the brand must attract a broader luxury audience while balancing appeal to high-net-worth and aspirational shoppers. Defining Versace’s identity in today’s logo-averse, quiet-luxury market will also be key. With Vitale’s new creative direction and Donatella’s continued influence as ambassador, the brand is poised for a fresh start.

When Capri acquired Versace in 2019, it aimed to build an American luxury powerhouse to rival European giants. But pandemic setbacks and the failed Tapestry merger derailed those plans. Now, under Prada, Versace returns to Italian hands—with a chance to reclaim its place in fashion’s elite.

Donatella Versace. Photo: Alessandro Lucioni / Gorunway.comCapri faced challenges due to its CEO succession plan. Meanwhile, Tapestry has been reshaping its strategy after the failed acquisition, recently selling Stuart Weitzman to Calares Group for $105 million to concentrate on its flagship brand, Coach.

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– A to-do list for Versace’s next owner
– Who is the Versace customer?
– Donatella Versace steps off the runway as Dario Vitale takes over as Versace’s new chief creative officer