Capri-Tapestry Deal Faces Antitrust Hurdles

Tapestry’s proposed $57 per share acquisition of Capri Holdings has encountered opposition from the Federal Trade Commission (FTC), raising concerns about potential antitrust violations. The FTC argues that the merger would result in Tapestry’s dominance in the “accessible luxury” handbag market and negatively impact employees. However, Tapestry disputes these claims, maintaining that the market is competitive and the deal would not harm consumers or workers. The case is expected to proceed to court, with a judge assigned to oversee the proceedings. The outcome of the trial is uncertain, but analysts believe there is a 60% chance that the deal will be approved. Capri’s stock price currently reflects a 29% likelihood of a legal victory, offering potential investment opportunities with an estimated return of 22% if the merger is successful.

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