Prada buys Versace for roughly $1.4 billion after Trump’s tariffs almost ruined the acquisition

Luxury fashion firm Prada Group has reached an agreement with Capri Holdings to acquire designer label Versace for $1.38 billion, according to Prada, after earlier reports indicated that the two Italian fashion behemoths struggled to complete the transaction as President Donald Trump’s tariffs roiled markets.

Prada revealed Thursday that it will finance its acquisition of Versace, which has been approved by both firms’ boards of directors, with around $1.6 billion in fresh debt after borrowing more than $1 billion.

Prada and Versace expect the purchase to finalize in the second half of the year, subject to regulatory approval.

An agreement between Prada and Versace was nearly disrupted after Trump declared reciprocal tariffs on U.S. trading partners, forcing companies to start depending on increased raw material costs as recession fears grew, according to the Wall Street Journal.