FTC Files Lawsuit to Block The Acquisition of Capri Holdings By Tapestry

The U.S. Federal Trade Commission took action on Monday to stop the $8.5 billion purchase of Capri Holdings by Tapestry, the parent company of Coach and Kate Spade.

This move pauses the deal for now. If it went through, it would bring together two big players in American luxury fashion.

Capri Holdings
The deal would merge major luxury brands, including Coach, Kate Spade, Versace, and Jimmy Choo. (Credits:  Tannen Maury)

It would also mean that six famous fashion brands—Coach, Kate Spade, Stuart Weitzman, Versace, Jimmy Choo, and Michael Kors—would be under one roof. This could help them compete better against top European luxury brands like Burberry and Louis Vuitton.

The FTC, in a statement, explained that if the companies merged, it could harm both shoppers and employees. It pointed out that Tapestry and Capri currently compete in various areas like clothing, eyewear, and shoes.

Capri Holdings
FTC sues to block $8.5B Capri Holdings Tapestry disputes FTC’s concerns, and emphasizes the need to win over modern shoppers across brands.

Henry Liu, from the FTC, expressed concerns that Tapestry’s desire to buy Capri could lead to less competition in the fashion world. He mentioned that consumers might end up with fewer choices for affordable handbags, and workers might lose out on better pay and working conditions.

However, Tapestry disagreed with the FTC’s stance. The company argued that the agency didn’t fully understand how consumers shop nowadays. They emphasized that they need to win over customers who shop across different brands, stores, and price ranges.

Sajda Parveen
Sajda Parveen
Sajda Praveen is a market expert. She has over 6 years of experience in the field and she shares her expertise with readers. You can reach out to her at [email protected]
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