Capri/Tapestry Call Off Merger

Luxury retailers Capri Holdings Ltd. (London) and Tapestry Inc. (New York) have pulled the plug on their planned merger, citing a variety of regulatory and legal obstacles that would have been hard to overcome by an agreed-upon completion date of Feb. 10, 2025. Capri is a global fashion luxury group consisting of founder-led brands Versace, Jimmy Choo and Michael Kors, while Tapestry’s holdings are Coach, kate spade new york and Stuart Weitzman.

The two companies simultaneously issued news releases announcing the scrapping of the deal.

“With the termination of the merger agreement, we are now focusing on the future of Capri and our three iconic luxury houses,” Capri Chairman and CEO John Idol said in that company’s release. “Looking ahead, I remain confident in Capri’s long-term growth potential for numerous reasons. First, we have an incredible portfolio of luxury houses, each with their own rich heritage, exclusive DNA and strong consumer loyalty. Second, we have a solid distribution network to build upon. With over 1200 directly operated luxury retail locations globally combined with our robust digital platform we have a strong framework for the future.”

Said Tapestry CEO Joanne Crevoiserat in her company’s statement: “We have always had multiple paths to growth and our decision today clarifies the forward strategy. Building on our successful first quarter, we will move with speed and boldness to accelerate growth for our organic business. Tapestry remains in a position of strength, with distinctive brands, an agile platform, passionate teams and robust cash flow.”

When plans for the $8.5 billion merger were unveiled last year, analysts said the deal would help both companies better compete against such rivals as LVMH, whose 75 brands include Tiffany, Fendi, Louis Vuitton and Dior. However, last month, a federal judge upheld the Federal Trade Commission’s decision to halt the planned merger for anti-competitive concerns; at the time, Tapestry and Capri said they planned to appeal that ruling.