The Prada Group has agreed to buy rival Versace from the U.S. luxury group Capri Holdings in a deal valuing the Milan fashion house at 1.25 billion euros ($1.4 billion.) Versace, which was founded in 1978 by the late Gianni Versace,

The price Prada has agreed to pay is a big discount to the roughly $2.15 billion including debt that US-based Capri, then known as Michael Kors, paid for Versace in 2018 when it was sold by the Versace family and Blackstone.

Versace is changing hands after Capri Holdings and Prada Group agreed a $1.375 deal, which will see the luxury label join after Capri's collapsed merger with Tapestry.