Editor’s note: This story is developing and will be updated.
The Federal Trade Commission won its lawsuit to block the planned merger between Tapestry Inc. and Capri Holdings, an FTC spokesperson confirmed to Fashion Dive on Thursday.
The proposed deal would have combined Tapestry’s Kate Spade, Coach and Stuart Weitzman brands with Capri’s Michael Kors, Versace and Jimmy Choo brands and would have created one of the largest luxury conglomerates in the United States.
The FTC sued to block the deal in April, claiming the deal would “eliminate fierce competition between the two companies.” It also stated the merger would give Tapestry “a dominant share of the ‘accessible luxury’ handbag market, a term coined by Tapestry to describe quality leather and craftsmanship handbags at an affordable price.”
In an email to Fashion Dive, Henry Liu, director of the FTC’s Bureau of Competition, said the decision wasn’t only a win for the FTC but also for consumers.
“These bags are a product which millions of people rely on throughout their daily lives,” Liu said. “The decision will ensure that Tapestry and Capri continue to engage in head-to-head competition to the benefit of the American public.”
Spokespeople for Tapestry and Capri didn’t immediately respond to Fashion Dive’s request for comment.