Does the "devil" now "wear Versace?" Prada just bought Italian fashion rival Versace and now everyone is wondering what is next.

The Prada Group announced a deal Thursday to buy crosstown Milan fashion rival Versace from the U.S. luxury group Capri Holdings under terms that values

Prada's $1.3 billion acquisition of Versace strengthens Italy's hand in the luxury industry led by French conglomerates.

The purchase of Versace exposes the agency’s antitrust blunder.

Prada is getting a discount but not a good deal. After weeks of talks with Michael Kors-owner Capri , the Hong Kong-listed Italian group agreed to pay 1.3 billion euros ($1.4 billion) for Versace. Given Capri paid $2 billion for the brand famous for its Medusa logo in 2018,

Fashion executive John Idol thought Versace leaned too much on ornate designs and aimed to fix it by dialing things down, then boosting prices.

The purchase, the largest in Prada’s 112-year history, returns Versace to Italian ownership and could put the company in a better position to compete with bigger luxury rivals such as LVMH and Kering SA.

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 Prada Group announced this week that it’s buying the luxury design house Versace for about $1.4 billion.