The US antitrust authority has filed a lawsuit to prevent Tapestry, a major fashion accessory company, from acquiring its rival Capri for $8.5 billion. Tapestry, known for brands like Coach and Kate Spade, sought to merge with Capri, owner of Michael Kors, aiming to create a stronger presence in the fashion market. However, the Federal Trade Commission (FTC) argued that the merger would eliminate competition between the two companies’ brands, potentially leading to negative impacts such as reduced wages and benefits for employees. While Tapestry countered that the FTC misunderstood the market dynamics and consumer behavior, the FTC maintained that the merger would grant Tapestry too much control over the market. The FTC’s move reflects a shift towards stricter antitrust enforcement, particularly in sectors like luxury fashion. Despite receiving clearance from regulators in the EU and Japan, the companies must finalize the deal by August 10.
US watchdog sues to block $8.5bn handbag takeover
