Luxury fashion house Prada braved market turbulence caused by the tariff trade war and completed its US$1.38 billion takeover of smaller rival brand Versace on April 10.

Prada acquired Versace from North America based Capri Holdings and brings together two of Italy’s most iconic fashion brands. By ILM.

“We will provide (Versace) with a strong platform, reinforced by years of ongoing investments and rooted in longstanding relationships,” Patrizio Bertelli, Chairman, Prada said in a company statement. The Prada Group already owns several other designer labels including Miu Miu and luxury footwear brand Chur

Its acquisition of Versace will create a multi-billion dollar luxury fashion group, putting the brands in a position to compete with French luxury fashion conglomerates LVMH and Kering. Negotiations to buy Versace between Prada and Capri began in February.

The price Prada agreed to pay for Versace is significantly lower than the US$2.15 billion that Capri Holdings spent when it bought Versace in 2018.

The deal, which includes the brand’s debts, comes as Versace has been operating at a loss amid a slowdown in demand for luxury fashion worldwide.

Capri also owns other fashion brands including Jimmy Choo and Michael Kors.