Versace set to be sold in $2bn deal

Fashion Designer Michael Kors attends Michael Kors and Google Celebrate new MICHAEL KORS ACCESS Smartwatches at Art Beam

Michael Kors, the fashion retailer known for upmarket but affordable apparel and accessories, is to pay between $2 billion and $2.4 billion for Versace, closing a chapter in the colourful story of one of the world's best-known brands.

Donatella Versace, who is sister of late founder Gianni and doubles as artistic director and vice-president of the Milan-based group, has called a staff meeting for Tuesday, according to a person who was briefed by a company employee.

Michael Kors, whose namesake label is best known for its leather handbags, has made no secret of its ambition to grow its portfolio of high-end brands after swooping on British stiletto-heel maker Jimmy Choo for $1.2 billion past year.

The move is in line with the US brand's ambition to aggregate various luxury brands - including fashion, shoes and accessories - under one larger group.

Kors, whose shares are listed in NY, alarmed investors earlier this year when it reported a decline in retail sales under its main brand in the Americas, even as the smaller European and Asian markets fared better. The Versace company returned to profitability in 2017, making it attractive to potential buyers, including Tiffany & Co., LVMH, PVH Corp., and Tapestry (that's the group that owns Coach), according to a report by Women's Wear Daily.

Versace could not immediately confirm the news to AFP.

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Givi in turn is half-owned by Allegra Versace Beck, daughter of Donatella and niece of late founder Gianni.

Versace, known for its flamboyant style and Medusa-head logo, hired chief executive officer Jonathan Akeroyd in 2016 from Alexander McQueen.

Versace and Blackstone both declined to comment to Reuters.

The stock market didn't react well to reports of an impending deal, with Kors shares trading at $66.11 at 11 a.m., down 9 percent.

French luxury group LVMH, led by billionaire Bernard Arnault, took full control of Christian Dior, in a €12bn deal that reunites the fashion house with the perfume and other Dior brands.LVMH, owns Dior perfumes and beauty after a deal in the 1960s to raise capital for the then-struggling brand. In a tribute to Gianni, Donatella Versace brought back the most iconic looks from his collections spanning the 1990s, including silk blouses mixing leopard prints with images of baroque architecture.

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