Federal Judge Blocks Luxury Handbag Makers' Merger - Articles

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Federal Judge Blocks Luxury Handbag Makers' Merger

Posted by: Julia Wilburn on Oct 29, 2024

A federal judge in New York has blocked the pending $8.5 billion merger of Tapestry — which owns the brands Coach, Kate Spade and Stuart Weitzman — and Capri, owner of the Jimmy Choo, Michael Kors and Versace brands. According to Reuters, the Federal Trade Commission (FTC), which sued to block the deal in April, argued the merger would eliminate fierce head-to-head competition between the top two U.S. handbag makers and create a massive company with the power to unfairly raise prices. The companies argued that "handbags are nonessential items whose price consumers can control by not buying them if they become too expensive," and that by consolidating the brands, they would have a stronger position in the competitive U.S. handbag industry as well as the European market.