FTC Challenges Tapestry’s Acquisition of Capri, Citing Concerns
The Federal Trade Commission (FTC) has expressed concerns over Tapestry’s proposed $8.5 billion acquisition of Capri, alleging that the deal would reduce competition and harm consumers and employees.
According to the FTC, the merger would bring together six brands: Tapestry’s Coach, Kate Spade, and Stuart Weitzman, and Capri’s Michael Kors, Jimmy Choo, and Versace. The agency argues that this would reduce competition in the fashion industry, particularly in the market for handbags.
The FTC also alleges that the deal would eliminate competition for employees between Tapestry and Capri. This, the FTC claims, could lead to lower wages and less favorable workplace conditions for employees.
Tapestry has defended the acquisition, arguing that the fashion industry is highly competitive and that the merger would not harm consumers or employees. The company also argues that the FTC has misunderstood the marketplace and the way consumers shop.
The FTC’s challenge to the proposed acquisition is a significant development in the ongoing debate over the impact of mergers and acquisitions on competition and consumer welfare. The outcome of the case could have implications for other large-scale mergers in the fashion industry and beyond.
