Michael Kors buying Jimmy Choo in £896m deal
Luxury shoe brand Jimmy Choo is to be acquired by US fashion brand Michael Kors in an £896 million deal.
London-listed Jimmy Choo put itself up for sale as part of a strategic review in April and on Tuesday Michael Kors said it is "the ideal partner" for the firm.
The group said in a statement that it will support the growth of Jimmy Choo through "retail store openings and further development of its online presence", adding that the shoe firm will operate under its existing management team, including chief executive Pierre Denis.
Under the terms of the deal, Jimmy Choo shareholders will receive 230p in cash for each share, a premium of 36.5% on the firm's share price of 168.5p on April 21.
John Idol, chairman and chief executive of Michael Kors, said: "We believe that Jimmy Choo is poised for meaningful growth in the future and we are committed to supporting the strong brand equity that Jimmy Choo has built over the last 20 years."
In March, Jimmy Choo cheered record revenues and profits thanks to a boost from the Brexit-hit pound and strong sales across Asia.
The designer firm saw annual revenues climb 15% to £364 million in the year to the end of December, while earnings lifted 16% to £59 million over the period.
Jimmy Choo counts Jennifer Lopez, the Duchess of Cambridge and Beyonce among its fans.
Chairman Peter Harf said: "A combination with Michael Kors will allow Jimmy Choo to embark on its next phase of growth and provide opportunities for the benefit of Jimmy Choo customers, employees, shareholders and other stakeholders."
Shares in Jimmy Choo rose 17% in morning trading.
Angus Grierson, managing director of LGB Corporate Finance, said: "Michael Kors' acquisition of Jimmy Choo follows strong performance by the British luxury brand, which reported record profits in March, boosted by the fall in sterling and robust sales across Asia.
"The deal is characteristic of a wider trend towards consolidation across a slowing luxury sector and follows rival Coach's acquisition of Kate Spade in May."