When Coach parent company Tapestry announced it would buy archrival Capri Holdings for $8.5 billion in the summer of 2023, it touted the move as a union that would give birth to an American luxury powerhouse.
The rationale was that Tapestry’s operational prowess would elevate Capri’s iconic but underperforming brands, including Michael Kors, Jimmy Choo, and Versace. Capri CEO John Idol said at the time that the deal would make the company a global player by giving it “greater resources and capabilities.”
Unfortunately, things haven’t quite turned out that way. Federal antitrust regulators put the kibosh on the merger in November; Tapestry can no longer be Capri’s white knight. And after a brutal earnings report from Capri this week, analysts are faulting the company for relying on the failed merger rather than making alternate plans to save its struggling business.
