Michael Kors is buying Jimmy Choo for £896 million ($1.2 billion), both brands announced Tuesday. Under the deal, each shareholder of the high-end footwear label will receive £2.30 ($3) per share in cash, WWD reports.
The acquisition is a response to the decrease in sales for upscale brands, as mall shopping has "declined sharply," reports the New York Times. Though e-commerce sites, fast-fashion brands, and even luxury labels like Gucci continue to thrive, brands in the "accessible luxury market," like Kors, are struggling. The Jimmy Choo deal comes two months after Coach made a similar move by buying Kate Spade for $2.4 billion.
Jimmy Choo makes for an interesting pair with Kors, as the former is known for its sky-high stilettos and glam, crystal-embellished designs, while the latter gravitates towards down-to-earth leather goods and ready-to-wear.
But Kors thinks they make a good match. The company told WWD it plans to incorporate the "experiences, infrastructure, and capabilities that it has developed over the course of its own worldwide growth as a luxury fashion brand to support the growth of Jimmy Choo through retail store openings and further development of its online presence."
Jimmy Choo will continue to function "as it does today" with Pierre Denis as CEO and Sandra Choi as creative director, so don't expect any big changes in the company or its designs. Meanwhile, Kors plans to add an "expanded assortment" of products to its own repertoire.