On Thursday, in the biggest luxury deal of the year, Prada announced it was buying Versace for 1.25 billion euros ($1.38 billion) from Capri Holdings, a beleaguered New York group that at one point styled itself as the American answer to the great fashion groups of France.

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.