Luxury fashion retailer Jimmy Choo (LON:CHOO) has been bought by Michael Kors, in a deal worth £896 million.
The deal was confirmed on Tuesday, just three months after Jimmy Choo was put up for sale. The luxury retailer, founded by Malaysian shoe designed Jimmy Choo and Tamara Mellon in 1996, has suffered from sinking sales in recent years as consumers gravitate towards higher and lower price brands.
Jimmy Choo will become a wholly-owned subsidiary of Michael Kors, with Kors’ honorary chairman, Mr Kors himself, saying “We admire the glamorous style and trendsetting nature of Jimmy Choo designs. We look forward to welcoming Jimmy Choo to our luxury group.”
The sale plan has been backed by Jimmy Choo’s main shareholder, JAB Holdings, and will offer a growth opportunity for middle-market retailer Michael Kors. The company has also suffered from a change in consumer behaviour, sowngrading its sales forecasts for the rest of the year and planning to close as many as 125 of its full-price retail stores.
We believe that Jimmy Choo is poised for meaningful growth in the future,” John D. Idol, the Michael Kors chairman and chief executive, said in a news release.
“We are committed to supporting the strong brand equity that Jimmy Choo has built over the last 20 years.”
Jimmy Choo shares have soared on the news, currently trading up 17.08 percent at 22831 (1234GMT).
