Prada is working with advisers to assess the Versace brand as it considers making a bid for the Italian fashion house owned by Capri Holdings Ltd.
The Milan-based luxury brand, which has stood out amid the recent downturn in the sector, has initiated a comprehensive review of Versace after gaining access to the company’s latest financial and sales data, according to sources familiar with the matter. Following the news, shares of Capri rose by as much as 7.5% in premarket trading in New York on Wednesday.
Prada is evaluating the possibility of making an offer, said the sources, who requested anonymity due to the confidential nature of the discussions. However, they emphasized that there is no certainty that this review will lead to an official bid. Prada declined to comment, and Capri did not respond to requests for comment outside of business hours.
For the third quarter of the current fiscal year, Versace reported revenue of $193 million, marking a 15% year-over-year decline. Additionally, the brand posted an operating loss of $21 million, compared to $14 million in the same period last year.