3 weeks ago
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The Federal Trade Commission (FTC), which is an independent agency of the US government which promotes consumer protection, argued during an eight-day trial in New York that the merger would eliminate head-to-head competition between the two handbag makers, which would lead to the creation of a huge company with the power to unfairly raise prices.
US District Judge Jennifer Rochon rejected the companies' defence of the deal, after they argued that handbags are nonessential items and consumers can control prices by not buying them if they become too expensive.
However, she said the argument “ignores that handbags are important to many women, not only to express themselves through fashion but to aid in their daily lives”, reports Reuters.
Tapestry believes that the ruling is incorrect and is planning an appeal.
Tapestry’s issued a statement which said: “Today’s decision granting the FTC’s request for a preliminary injunction is disappointing and, we believe, incorrect on the law and the facts. Tapestry and Capri operate in an industry that is intensely competitive and dynamic, constantly expanding, and highly fragmented among both established players and new entrants.
“We face competitive pressures from both lower and higher priced products and continue to believe this transaction is pro-competitive and pro-consumer. We intend to appeal the decision, consistent with our obligations under the merger agreement.”
In August 2023, Tapestry, announced the acquisition of Carpi Holdings which would create a US fashion giant bringing Coach, Kate Spade, Stuart Weitzman, Versace, Jimmy Choo and Michael Kors under one house.
English (US) ·