Michael Kors & Jimmy Choo is a match made in heaven

Obviously Michael Kors knows how to buy shoes. The American clothing and handbag brand is acquiring shoemaker Jimmy Choo for £896 million, or about $1.2 billion ending a rumour that has long been circulating around the fashion business scene. 

A pioneer of so-called “affordable luxury”, Michael Kors has been seeking a new avenue of growth and Jimmy Choo is to give the company an upmarket foothold to stabilize its business and gain revenue.

Michael Kors plans to “support the growth of Jimmy Choo through retail store openings and further development of its online presence as well as through an expanded assortment of additional fashion product offerings.” Michael Kors Holdings said it intends to leave the brand’s existing management team in place in what its chief executive characterized as the first step in building a bigger international luxury group.

“Acquiring Jimmy Choo is the beginning of a strategy that we have for building a luxury group that really is focused on international fashion brands,” John D. Idol, the chairman and chief executive of Michael Kors Holdings, said in an interview. Mr. Idol said he was targeting more acquisitions, focusing on luxury companies that “lead in style and trend” but also “have got some size and scale” as well as “some heritage.”

The deal for Jimmy Choo came just months after Coach agreed to a $2.4-billion deal to buy the American handbag and accessories brand Kate Spade, apparently hoping that the combination of two affordable luxury brands could help it carve out new territory in a crowded market. Coach acquired its own upmarket shoemaker, Stuart Weitzman, in 2015.

Jimmy Choo was founded in 1996 by Tamara Mellon, then the accessories editor at British Vogue, with the Malaysian cobbler Jimmy Choo and became the first luxury footwear brand to list on a public market in 2014.

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