Michael Kors to Buy Jimmy Choo for $1 Billion

Michael Kors to Buy Jimmy Choo for $1 Billion

They're hoping the shoe company can double sales.

Published July 25, 2017

In an attempt to bolster both reputation and sales, Michael Kors is set to acquire Jimmy Choo for $1.2 billion. Kors, a label that's now considered the bastion of basic, has been plagued by declining revenue and hopes that the acquisition will double the brands sales. The deal is expected to close in the fourth quarter of 2017.

Kors's market value has fallen two thirds in the past three years in part due to its product being sold at discount stores. The label is vying to increase its clout with this new move. 

NPR noted the following: "In a conference call, Michael Kors CEO John D. Idol said he believes Jimmy Choo 'can more than double its sales to $1 billion annually.' The two brands will continue to operate "very independently," he added, but will together make up a global fashion luxury group.'

This pivot to focusing on the formation of a new luxury group is a new strategy for Kors. "This will not be [Michael Kors's] last acquisition," CEO John Idol told CNBC, noting that the company has laid out a "2020 plan" with an eye on "returning to growth" by 2018.

Could Kors be the next LVMH or Kering? Only time will tell. 

Written by BET Staff

(Photo: FG/Bauer-Griffin/GC Images)

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