-=Michael Kors (KORS) to buy Gianni Versace SpA for about 2 billion euros ($2.35 billion)

• The handbag maker is acquiring Gianni Versace for $2.1 billion, including debt, providing Kors an entry into the exclusive high-end European luxury market.
• As part of the deal, Donatella Versace, who has helped run the company since her brother Gianni was murdered in 1997, will stay on to oversee the brand.
• The global market for personal luxury goods was estimated to be worth $307 billion in 2017.
• Following the close of the acquisition, Michael Kors will change its name to Capri Holdings, inspired by an “iconic, glamorous and luxury destination” island, the company said.

Michael Kors Holdings Ltd.is close to a deal to buy Italian fashion house Gianni Versace SpA for about 2 billion euros ($2.35 billion), people familiar with the matter said Monday, in a move that would put one of the glitziest names in high fashion in the hands of a budding U.S. conglomerate better known for affordable luxury.

A deal would give Michael Kors — whose best-known product is a handbag priced at less than $500 — a sought-after foothold in high fashion. Versace handbags start at $1,500. A Versace velvet dress emblazoned with a leopard sells for more than $2,500.

The Versace family’s decision marks the end of its tumultuous control of the fashion house. Founded in 1978 by Gianni Versace, the label quickly became famous for his sexually charged designs, featuring colorful prints and daring cuts.

In 1997, Versace was gunned down outside his Miami Beach mansion by a serial killer, who targeted his randomly. His sister, Donatella Versace, became creative director after his death.

Donatella Versace struggled with drug abuse and checked herself into a rehabilitation program in 2004, casting a cloud over the label. Versace recovered and has overseen operations at the company ever since.

Private-equity giant Blackstone Group,which owns 20% of Versace, is planning to sell its stake in the business as part of the deal, one person said.

In recent years, Versace has struggled to grow sales, despite a luxury-fashion boom led by Chinese consumers. The brand has been overshadowed by Italian rival Gucci, which has become one of the fashion industry’s fastest-growing brands. It has embraced a quirky, at times resolutely unsexy, aesthetic.

The Italian newspaper Corriere della Sera first reported the deal.

Kors early on made its mark pursuing the affordable part of the luxury market, positioning itself in a similar way as Coach, the leather goods and accessories maker, which recently renamed itself Tapestry Inc.
Both have tried to appeal to shoppers who aspired to high-end goods but were on more of a budget. Kors rapidly expanded by opening its own boutiques and now has more than 800 stores world-wide. It had $4.7 billion in sales as of its most recent fiscal year, which ended in March.