The group’s effort to revive the fortunes of the iconic label founded by Gianni Versace will require both patience and pain.

Prada Group on Tuesday officially took control of Versace, which, despite its global recognition, powerful place in pop culture and clear aesthetic signature, has never had business success to match the strength of its brand. With the €1.25 billion ($1.44 billion) acquisition, which cleared final regulatory hurdles, Prada adds one of Italy’s most glamorous but troubled fashion houses to its portfolio: Versace has been listless under Capri Holdings, which paid €1.83 billion for the house in 2018.

Like most of its peers, Versace has suffered through the recent downturn in luxury demand, with
revenue dropping by a quarter in the last two years. But Versace’s woes run deeper, with its
most-recent annual revenue below that of the fiscal year that ended in March 2020, the first full
year under Capri ownership