Tapestry Inc. (NYSE: NYSE:TPR) is one step closer to finalizing its acquisition of Capri Holdings Limited (NYSE: NYSE:CPRI), as the company announced today that it has received unconditional regulatory clearance from the European Commission (EC) under the EU Merger Regulation. This approval, dated April 15, 2024, follows a similar nod from the Fair Trade Commission of Japan (JFTC) under the Antimonopoly Act on April 10, 2024.
The agreement, initially disclosed on August 10, 2023, involves Tapestry acquiring Capri in a transaction that is subject to various closing conditions, including regulatory approvals. With the recent approvals from the EC and JFTC, the only remaining antitrust regulatory clearance needed is from the United States. Tapestry has obtained all other necessary antitrust regulatory approvals for the transaction in jurisdictions where such clearance is a condition for closing.
The completion of the deal remains contingent on the satisfaction or waiver of other closing conditions outlined in the Merger Agreement. As of today, the precise timeline for the finalization of the acquisition has not been provided, but recent developments suggest that the process is in its final stages.
Tapestry's pursuit of Capri Holdings is part of a strategic move to expand its luxury fashion portfolio, which already includes notable brands such as Coach , Kate Spade, and Stuart Weitzman. The addition of Capri, known for its luxury fashion brands including Michael Kors, Versace, and Jimmy Choo, is expected to create a global powerhouse in the high-end fashion market.
The information for this article is based on a recent SEC filing.
InvestingPro Insights
As Tapestry Inc. (NYSE: TPR) navigates the final stages of its acquisition of Capri Holdings Limited, investors and analysts are closely monitoring the company's financial health and stock performance. Tapestry's strategic efforts seem to be paying off, as reflected in some key metrics from InvestingPro.
The company boasts a robust gross profit margin of 72.28% for the last twelve months as of Q2 2024, signaling efficient operations and strong pricing power. This impressive figure aligns with one of the InvestingPro Tips highlighting Tapestry's impressive gross profit margins. Additionally, Tapestry's market capitalization stands at $9.53 billion USD, showcasing the company's significant presence in the luxury fashion market.
Another InvestingPro Tip for Tapestry is its low P/E ratio relative to near-term earnings growth, currently at 9.41 adjusted for the last twelve months as of Q2 2024. This suggests that the stock could be undervalued considering its earnings potential, which might interest value-oriented investors.
With the acquisition potentially adding to Tapestry's growth trajectory, the company's stock has experienced a large price uptick over the last six months, with a 59.25% total return. This strong performance is indicative of investor confidence and market anticipation of the synergies expected from the Capri Holdings integration.
For those looking to delve deeper into Tapestry's financials and stock performance, InvestingPro offers additional insights and tips. Currently, there are 11 more InvestingPro Tips available that can help investors make more informed decisions. To access these tips and more detailed analysis, visit https://www.investing.com/pro/TPR and remember to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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