Fashion company, ‘Michael Kors Holding Ltd.’ have announced the acquisition of luxury shoe maker, ‘Jimmy Choo PLC’ for $1.2bn.
The acquisition is Michael Kors' first acquisition in its attempt to discover new avenues for growth following a decline in handbag business.
Michael Kors Holding LTD. CEO, ‘John Idol’ stated that the acquisition was just the beginning for the luxury handbag makers, adding that the company was focused on forming a 'luxury group' as laid out in the company's '2020 plan' with the aim of returning to growth by next year.
"This will not be [Michael Kors'] last acquisition. [Jimmy Choo] isn't a company we have to do a turnaround or significant change in the product or marketing strategy".
According to reports, Michael Kors has revealed that Jimmy Choo will continue with its current management team despite the acquisition, adding that new retail stores will be opened for the London-based shoe brand.
Michael Kors has suffered a shortfall of profits off late with its shares having sunk more than 4 percent.
The market for luxury shoes has been on the steady rise with demands for luxury handbags on the decline which is no doubt the reason why Michael Kors decided to widen its scope and acquire the luxury shoe brand.
Jimmy Choo is well known for its stiletto heels and accessories with sales in cities such as London, New York, Paris, Tokyo and more.
The British shoe brand was put up for sale in April 2017 after its majority owner, ‘JAB Holdings’ decided to focus more on foods and beverages following its acquisition of ‘Panera Bread’.