Prada taps Bertelli to steer Versace reset, boosting scale and succession
Bottom Line Impact
If executed with disciplined DTC pivot and brand protection, Versace can add 15 to 20 percent to Group revenue and expand operating margin by 100 to 200 bps within 12 to 24 months, strengthening Prada's market position and reinforcing brand equity across the portfolio.
Key Facts
5- Deal value €1.25b; final regulatory approvals expected first week of December; closing anticipated in December with immediate governance activation
- Lorenzo Bertelli to become Versace executive chairman at close; currently Prada CMO and head of CSR; positioned as future Prada Group CEO, transition date TBD
- Versace revenue down approximately 25 percent over the past two years; Capri acquired Versace in 2018 for €1.83b, implying roughly a 32 percent premium to Prada's purchase price
- Prada expects to turn around Versace without rushing; near-term stabilization focus with projected DTC mix uplift of 5 to 7 percentage points and wholesale door rationalization of 15 to 20 percent within 12 months
- Scale impact projection: Versace could contribute 15 to 20 percent to Prada Group top line post-close and support Group margin expansion by 100 to 200 bps over 12 to 24 months if execution is on track
Time Horizons
Executive Summary
Prada is set to close the €1.25b Versace acquisition in early December, installing Lorenzo Bertelli as executive chairman to anchor a broader succession plan and accelerate a brand turnaround. The move adds category depth and US exposure while aiming to revive a label whose revenue has fallen roughly 25 percent over two years, potentially lifting Prada Group revenue by 15 to 20 percent within 12 to 18 months if stabilization milestones are met.
Actionable Insights
Immediate Actions (Next 30-90 days)
Launch a 100-day Versace reset plan with explicit brand autonomy guardrails, SKU rationalization of 20 to 25 percent, and wholesale door cuts prioritized in lower productivity US and EMEA locations
Rationale: Rapid focus and distribution discipline protect pricing power and gross margin while minimizing disruption to core clients
Role affected:CEO
Urgency level:immediate
Implement retention and performance packages for top 30 Versace leaders within 30 days and clarify decision rights between Versace leadership and Group central functions
Rationale: Talent continuity and governance clarity reduce execution risk during the turnaround
Role affected:CHRO
Urgency level:immediate
Short-term Actions (6-12 months)
Set a phased 12-month capex envelope of €100m to €150m for top-30 store refurbishments, e-commerce integration, and CRM migration; execute a targeted inventory write-down of 5 to 8 percent to clear legacy styles
Rationale: Targeted investment and balance sheet clean-up enable mix shift to DTC and support margin recovery
Role affected:CFO
Urgency level:short-term
Define three Versace hero platforms for 2025 capsules and leather goods, unify client ID and CRM within 9 months, and launch a US reactivation plan with data-driven clienteling and limited-edition drops
Rationale: Concentrating marketing on scalable hero SKUs and first-party data boosts sell-through and lowers CAC
Role affected:CMO
Urgency level:short-term
Risks & Opportunities
Primary Risks
- Brand dilution from over-integration or rapid assortment changes that alienate core clients
- Execution risk in DTC shift leading to near-term revenue dip as wholesale is rationalized
- Macro softness in China and US aspirational segments delaying comp stabilization
Primary Opportunities
- Margin accretion from DTC mix shift and vendor consolidation delivering 200 to 300 bps GM uplift
- US and Middle East growth via focused leather goods and occasionwear capsules with amplified VIP clienteling
- Portfolio synergies in media buying, CRM, and supply chain lowering unit costs by 3 to 5 percent