Prada’s long-standing ambition to remain fiercely independent in the face of luxury mega-conglomerates like LVMH and Kering just took a bold step forward. The Italian fashion powerhouse, controlled by Chairman Patrizio Bertelli and Creative Director Miuccia Prada, has agreed for Versace acquisition in a landmark €1.25 billion deal — the largest in Prada’s 112-year history.

The purchase, made from Capri Holdings Ltd., marks a defining move in Prada’s evolution, bolstering both its brand portfolio and succession strategy. The final deal was negotiated below the initial €2 billion asking price, even landing a last-minute discount on the already-lowered €1.4 billion figure — influenced, insiders say, by global market volatility including tariff uncertainty from the U.S.

The acquisition also marks a major milestone for Lorenzo Bertelli, the couple’s son and Prada’s designated successor. Currently head of marketing and corporate social responsibility, Lorenzo, 36, is being groomed to take over leadership in the coming years. The move to bring Versace into the fold signals the family’s intent to safeguard Prada’s autonomy while expanding its influence.

“This is not about revolution, but evolution — small, steady steps that unlock a brand’s potential,” Lorenzo said, noting the synergy between Prada’s minimalist edge and Versace’s bold, baroque flair.

For Prada, which reported record 2024 results driven largely by the youth-favored Miu Miu label, the timing of the deal is strategic. As the global luxury sector faces pressure from weakened demand in China and the U.S., adding a legacy brand like Versace diversifies Prada’s appeal and positions it as a stronger competitor among the industry’s giants.

However, turning around Versace — a label that’s far removed from its 1980s and ’90s heyday — won’t be easy. Analysts have voiced caution. “It’s a demanding challenge that could slightly dilute Prada’s strong growth narrative,” said Paola Carboni of Equita. Prada’s shares, listed in Hong Kong since 2011, have already fallen over 30% from their February peak.

Still, Prada’s leadership sees this as a long-term investment. CEO Andrea Guerra emphasized that revitalizing Versace will take time, with a focus on sustainable success. Versace will operate as a standalone unit, mirroring Prada’s approach with Miu Miu. Design responsibilities won’t shift to Miuccia Prada; instead, Dario Vitale — recently appointed from Miu Miu — will lead the creative direction, following Donatella Versace’s departure in March.

The deal also underscores a symbolic moment in Italian fashion, uniting two iconic family-led brands in an era where many have been absorbed by multinational groups. Donatella Versace herself welcomed the news: “Gianni and I have always had huge admiration for Miuccia, Patrizio, and their family,” she wrote on Instagram. “I’m absolutely delighted for Versace to become part of the Prada family.”

With this acquisition, Prada not only fortifies its portfolio but also its legacy — placing the brand’s future firmly in the hands of the next generation.