Prada Group has officially acquired Versace for $1.37 billion, ending the brand’s six-year stint under Capri Holdings. The deal brings together two of Italy’s biggest fashion houses, hands Versace to Prada heir Lorenzo Bertelli, and positions both groups for a reset as the luxury market cools. Analysts say the move could give Versace the discipline, scale, and supply-chain muscle it has lacked—and help Prada grow its influence in global luxury.

Why Prada Bought Versace and Why Now

Prada Group’s acquisition of Versace instantly reshapes the Italian luxury landscape. The $1.37 billion deal, now fully approved and completed, brings Versace under the same roof as Prada and Miu Miu.

For Prada, the purchase secures another globally recognized label at a time when scale, manufacturing control, and brand consistency matter more than ever. For Capri Holdings, which previously owned Versace, the sale offers an exit from mounting debt and a chance to refocus its resources.

Capri’s CEO John D. Idol said the sale “significantly reduces the company’s debt load and improves its leverage ratio,” setting the stage for Capri to reorganize around Michael Kors and Jimmy Choo. Capri expects its business to stabilize this year and return to growth by FY27.

What Went Wrong for Versace Under Capri?

Versace did enjoy momentum in the years immediately following the pandemic, but the recovery stalled. Capri’s financial disclosures show that the brand struggled to hit targets in early 2025.

The shift from “high glam” to “quiet luxury”

Analysts say Versace’s signature maximalism—bold colors, baroque prints, and gold hardware—didn’t align with the global move toward understated, label-less luxury. Think tailored camel coats, muted palettes, and “stealth wealth.”

That mismatch was expensive. Demand softened, particularly in the US and China, two markets that have been cautious with big-ticket fashion spending.

A brand with strong identity, but weaker structure

Reports suggest Versace lacked the operational discipline and pricing consistency needed to scale globally. It also faced challenges in supply chain flexibility, merchandising strategy, and long-term capital planning.

This is where Prada’s strengths come in.

How Prada Plans to Revive Versace

Prada Group has spent the last five years quietly transforming itself—improving production speed, streamlining collections, and investing in high-end craftsmanship. Analysts believe these strengths will be key to turning Versace around.

1. Strengthening manufacturing

Prada already runs sophisticated facilities for Prada, Miu Miu, and Church’s. Versace will be added to the group’s Scandicci leather goods factory, where artisans produce some of Italy’s most technically complex bags.

Lorenzo Bertelli—Prada’s marketing director, sustainability lead, and heir—put it simply:

“Making a bag for one brand or another, the know-how is the same.”

Prada is also expanding its supply chain footprint:

• A new leather goods factory near Siena
• A knitwear center near Perugia
• Increased production for Church’s footwear in the UK
• A training academy that has produced 570 artisans over 25 years, hiring 70% of its 2024 cohort

2. Adding pricing and product discipline

Analysts quoted by IANS say Prada’s management style—tight control over pricing, SKU management, and global distribution—could give Versace the guardrails it needs.

3. Building long-term brand scalability

Prada expects Versace to account for about 13% of the group’s combined pro forma revenue. It’s a meaningful bet, but one with upside: Versace currently delivers 20% of Capri’s revenue, signaling a large customer base in need of better alignment and strategy.

Who Will Lead Versace Now?

Lorenzo Bertelli will become Executive Chairman of Versace. At 36, he is widely expected to guide the brand with a younger, more strategic eye—balancing Versace’s heritage with Prada’s restraint.

Bertelli says he does not plan immediate changes but acknowledges the brand’s “long-standing underperformance.” His approach appears to be patient, systematic, and structure-first.

Creative direction stays with Dario Vitale

Versace is already in a creative transition. Designer Dario Vitale debuted his first runway show in Milan in September, offering a modern take on the house’s iconography. Prada’s acquisition is likely to give Vitale more stability to experiment and evolve.

How the Fashion World Is Reacting

Donatella Versace celebrated the acquisition by posting a photo of her brother, founder Gianni Versace, noting that the deal was finalized on his birthday. Her message:

“Today is your day and the day Versace joins the Prada family. I am thinking of the smile you would have had on your face.”

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In fashion symbolism, that’s as close to a blessing as it gets.

The move has also sparked comparisons to other major luxury consolidations:

• Kering’s acquisitions of Gucci, Bottega Veneta, and Balenciaga
• LVMH’s control of Dior, Louis Vuitton, Celine, and others

Prada’s move suggests it, too, is positioning itself as a multi-brand powerhouse.

Why the Prada–Versace Deal Matters for Luxury’s Future

Luxury is entering a consolidation phase

As spending cools and competition rises, groups that control their manufacturing, supply chain, and brand ecosystems will outperform standalone labels.

Versace has global recognition but needs a modern strategy

Its cultural cachet, celebrity history, and strong design DNA give it enormous potential. Prada’s structure may be exactly what unlocks it.

Prada gets a brand with high awareness among younger shoppers

Versace remains popular among Gen Z and millennials, especially in the US and Asia. Prada’s more minimal aesthetic skews differently; owning Versace diversifies the portfolio.

A more unified Italian luxury powerhouse

For decades, Italian luxury has been overshadowed by French conglomerates like LVMH and Kering. Prada’s acquisition signals a new chapter—one where Italian houses consolidate to compete a global scale.

What to Watch Next

Here are the key questions for 2025 and beyond:

• Will Prada shift Versace toward more subtle “modern glam” to match consumer trends?
• Can the group drive better margins through unified production?
• Will Versace’s retail footprint be restructured or expanded?
• How will Dario Vitale’s vision evolve with more resources?
• Can the Prada–Versace portfolio rival the French giants in the long run?