Business
Capri Holdings Is Reportedly Considering Selling Versace And Jimmy Choo
By Eva Morletto16 décembre 2024
Following its failed attempt to merge with US group Tapestry, Capri Holdings is reportedly considering selling its two iconic fashion houses to concentrate on relaunching Michael Kors. Barclays Bank is said to be looking for potential buyers.
Rumors are rife in the fashion world: New York-based Capri Holding has reportedly entrusted investment bank Barclays with selling its flagship houses, Versace and Jimmy Choo. Headed by John Idol, the group is one of several luxury giants affected by the recent crisis in the sector. This potential restructuring, which comes after the failed attempt at a strategic merger with the American luxury group Tapestry, could be a new solution the group is considering to cope with declining financial results. A month ago, the American courts blocked what was to have been the wedding of the century in the US (valued at 8.5 billion dollars), on the grounds that the union would weaken competition in the sector.
This decision comes against a backdrop of a general slowdown in sales for Capri Holdings, which has suffered from a difficult start to the year. Results for the year's first quarter showed a 13.2% fall in sales, forcing the group to accelerate innovation strategies and potential reshuffles. The details of this possible sale have yet to be specified, leaving doubt as to whether the two brands will be sold jointly or separately.
At a time when young buyers are favoring sober, timeless styles - as evidenced by the popularity of ‘quiet luxury’ - Versace's eccentric style seems to be losing appeal. The brand's sales, totaling 219 million dollars (196 million euros) at the start of the year, fell by 15.4% on a reported basis and by 14.3% at constant exchange rates, with a worrying double-digit drop in wholesale sales. The situation is particularly worrying in the European and American markets, where sales fell by 22% and 15% respectively, while Asia saw a more modest decline (-3%).
The same can be said of shoe manufacturer Jimmy Choo, which, at the start of the year, was experiencing a worrying slowdown, though not as severe as Versace. Despite a few positive performances throughout the year, the 2024 financial year was not a good one overall: Versace, Jimmy Choo, and Michael Kors all saw their sales fall by 7.9%, 3%, and 9.5%, respectively.
Despite these declining figures, Versace and Jimmy Choo retain a strong identity and appeal, which should make it easier for Barclays to sell them. All the more so as Capri Holdings has counted 12.6 million new customers in 2024, 15% more than the previous year, according to its CEO John Idol.
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