Tapestry Terminates Merger Agreement with Capri Holdings Limited

On November 13, 2024, Tapestry, Inc. (NYSE: TPR), a renowned house of iconic accessories and lifestyle brands, announced the termination of its merger agreement with Capri Holdings Limited. This decision comes after both companies agreed that terminating the agreement would serve the best interests of all parties involved, as the legal process was unlikely to be resolved by the February 10, 2025 outside date.

Tapestry’s Chief Executive Officer, Joanne Crevoiserat, emphasized the company’s commitment to driving accelerated organic growth and shareholder value, citing multiple growth paths and a strong strategic position. She highlighted Tapestry’s distinctive brands, agile platform, passionate teams, and robust cash flow as key strengths. The termination of the merger agreement also prompted Tapestry to launch a new repurchase program aimed at returning capital to shareholders. The Company will repurchase up to $2.0 billion of outstanding shares of its common stock, funding the program through a mix of cash and potential debt issuances.

Moreover, in light of the termination, Tapestry will redeem senior notes associated with the planned acquisition totaling $6.1 billion through a Special Mandatory Redemption feature, with the Company reimbursing Capri’s expenses arising from the transaction. The Company also plans to fund the share repurchase program partly through future debt issuances, maintaining its leverage target and investment grade rating.

Lastly, Tapestry reaffirmed its Fiscal 2025 outlook and its commitment to shareholder value through sustained dividend payments, formidable free cash flow generation, and capital allocation priorities. The Company emphasizes reinvesting in its brands, maintaining an investment grade rating, returning capital via dividends and share repurchases, and strategic portfolio management to enhance long-term value creation.

The termination of the merger agreement has prompted significant strategic shifts at Tapestry, driving a renewed focus on organic growth, enhanced shareholder value, and disciplined capital deployment strategies.

For further details, please refer to Tapestry’s filings with the Securities and Exchange Commission.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read Tapestry’s 8K filing here.

About Tapestry

Tapestry, Inc provides luxury accessories and branded lifestyle products in the United States, Japan, Greater China, and internationally. The company operates in three segments: Coach, Kate Spade, and Stuart Weitzman. It offers women’s handbags; and women’s accessories, such as small leather goods which includes mini and micro handbags, money pieces, wristlets, pouches, and cosmetic cases, as well as novelty accessories including address books, time management and travel accessories, sketchbooks, and portfolios; and belts, key rings, and charms.