Prada Braves Choppy Luxury Waters Buying Versace for $1.35bn.

 

We steer clear of global geopolitical events usually on this little blog, and we won't change that in any significant regard today.  We can however without being partisan make an objective statement, that at time of writing in early 2025 the luxury market is struggling, with even Hermes targets not being met, and that due to world events, it's a tough time to be a luxury brand.  These facts make Prada's decision to go ahead with acquiring Versace a particular bold move.

The reality is that deals like this are years in the making.  Numerous high-level meetings, and copious due-diligence studies. These stages take considerable time.  There may even have been some sort of penalty for not completing the acquisition after a certain point.  Nonetheless, to take a large chunk of capital, even if partially leveraged by debt, in such uncertain times, is admirable.

We applaud the brazenness of the act, and are hopeful it reinvigorates both brands.  With Versace's glamour dragging Prada out of its dull eternal 1960's aesthetic, and Prada tempering some of Versace's most vulgar excesses/. Let's wait and see.