MULTI-BRAND STRATEGY
Berenberg analyst Zuzanna Pusz said the deal followed in the footsteps of Coach's recent acquisition and showed U.S. accessible luxury companies were pursuing the multi-brand strategy found in Europe, where cash flows from one large brand are reinvested into smaller but faster growing ones.
Pusz said it was probably a sensible move in the long term, with competition unlikely to wane anytime soon.
"Multiple companies such as Jimmy Choo, Prada, Ferragamo, and Cucinelli have gone public over the past couple of years with the intention of financing their retail expansion plans, thus accelerating their investments and giving the luxury consumer globally more choice of brands anywhere they go."
Jimmy Choo put itself up for sale in April after its majority-owner JAB, the investment vehicle of Germany's billionaire Reimann family, signalled its intention to focus on consumer goods instead. JAB is also considering a sale of Bally International, the Swiss luxury shoes and accessories company.
The deal is the latest in a string of foreign takeovers of UK companies, as buyers abroad take advantage of a drop in the value of sterling since Britain voted to leave the European Union in June 2016.
Michael Kors, which said it had JAB's backing for the deal, pledged to use its own infrastructure to help Jimmy Choo grow further via store openings and online.
Jimmy Choo will continue to be led by the same management team, including Creative Director Sandra Choi who joined the company at its inception.
Goldman Sachs and JP Morgan acted for Michael Kors on the deal, while Merrill Lynch, Citigroup, Liberum and RBC Europe acted for Jimmy Choo.
($1 = 0.7670 pounds)
