U.S. Competition Authority Brushes Fashion Brand Coaches, Michael Cores Merger

The U.S. rival authorities have put a brake on U.S. fashion brands and Coach's parent company Tapestry, which has given up $8.5 billion in mergers and acquisitions with Capri Holdings, which owns Michael Kors and others.

Tapestry said it would not be able to close the merger schedule until February next year, the deadline for the merger, due to continued legal uncertainty, and that it would end its acquisition and merger agreement with Capri under a mutual agreement.

Earlier last month, the U.S. Southern Federal Court in New York ruled in favor of the committee in a lawsuit filed by the Federal Trade Commission asking it to block Tapestry's acquisition of Capri.

The Federal Trade Commission sued in April to block the merger, saying the merger between the two companies would hamper competition in the high-end handbag market, which is relatively less expensive than ultra-high-end luxury handbags.

Tapestry and Capri are operating in highly competitive market conditions and have pleaded that a merger is necessary to compete with European luxury brands, but it has not been accepted.

Tapestry has coaches and Kate Spade and Stuart Witzman, while Capri has Michael Kors, Versace and Jimmy Choo as affiliated brands.