Introduction: After a series of major announcements, Versace has levitated its growth trajectory and merged its iconic diffusion lines Versus and Versace Jeans. Is this brand dilution or a step towards financial solvency? Only time will tell. All eyes are set on the prize as Donatella vehemently declares – “This is just the beginning of an exciting, new adventure, I hope you will live it together with me!”After whirlwind speculations, a landmark $2.12 billion deal signed in September 2018 officially confirmed the acquisition of Versace by Michael Kors Holdings. The American company has subsequently been renamed as Capri Holdings, with three major fashion houses now under its portfolio: Michael Kors Collection, Jimmy Choo, and Versace. With an aim to scale up significantly through licensing and diffusion lines, this power move has proved to be an important milestone for the global conglomerate-in-the-making. Capri’s headquarters are in London, and its three businesses will continue to operate in separate cities and countries. Michael Kors is headquartered in New York, Jimmy Choo in London and Versace in Italy.What does this acquisition mean for Versace’s future? Yes, one of the most successful all-American brands in the market is now the proud owner of the most prominent name in Italian luxury. It’s unexpected and perhaps alarming. But Versace is still Versace, or so they claim.The family now holds shares of Capri Holdings Limited, and Donatella will be retaining her role as creative director of the fashion house. After her brother Gianni Versace’s murder in 1997, she had taken over the reins of the company and has been the face of the brand since over 20 years now.The company’s most notable announcement since the acquisition was to integrate their diffusion line – VERSUS, with their contemporary line, Versace Jeans. The fashion world has been concerned that brand dilution was inescapable after the business deal, this merger can be viewed as the first sign. Putting to rest speculations that she may be in search of a successor, Donatella has recently declared that her passion has never been stronger upon the merger, and she will helm both the lines. This move is in lieu with the ongoing trend adopted by many luxury brands of eliminating the production of secondary lines to focus on a single pret-a-porter offering with a tighter brand portfolio, stronger brand identity and a simplified business model.Versus was presented in 1989 as a gift from Gianni to his sister. And, although the brand went on a four-year standby from 2005 to 2009, since then it has played a pivotal role in Versace’s campaign to inject a youthful spirit into the brand and create millennial focussed designs. Collaborators have included renowned names like Christopher Kane, JW Anderson, Anthony Vaccarello and MIA, but Donatella has always played a dominant role, offering insight into how conventional styles could be reimagined in fresh and relatively affordable ways.The deal has been a huge eye-opener for trade analysts. Only time will tell if this move will benefit the brand for the better or worse. Versace Jeans is licensed to Swinger International, the Italian group that also produces for the Cavalli Class label and ready-to-wear brand Genny. Both parties are expected to be part of the “Versace Jeans” relaunch in November this year.