01—Abstract
Summary
Summary of the 8-K filed April 22, 2024. Cited figures are marked; the original filing is the authoritative source.
Tapestry, Inc. (NYSE: TPR) disclosed in a Form 8-K filed April 22, 2024 that the U.S. Federal Trade Commission filed a complaint in the U.S. District Court for the Southern District of New York on the same day seeking to enjoin its proposed merger with Capri Holdings Limited.
The merger agreement, dated August 10, 2023, provides that Merger Sub, a wholly owned subsidiary of Tapestry, will merge into Capri, with Capri surviving as a wholly owned subsidiary of Tapestry. In response, Tapestry issued a press release (Exhibit 99.1) stating it has full confidence in the transaction's pro-competitive merits, that it has strong legal arguments and will present them in court, and that it is working to close the transaction in calendar year 2024. The release describes the FTC as the last regulator yet to approve the deal.
For investors, the key development is the litigation risk to a pending transaction. The filing itself does not state the outcome of the action, any deal terms beyond the agreement's existence, or a timeline for the court proceeding.
02—Key points
Key Highlights
- On April 22, 2024, the FTC filed a complaint in the U.S. District Court for the Southern District of New York seeking to enjoin the Tapestry–Capri merger.
- The merger agreement, dated August 10, 2023, would make Capri Holdings Limited a wholly owned subsidiary of Tapestry after Merger Sub merges into Capri.
- Tapestry stated it has full confidence in the transaction and strong legal arguments, and intends to present them in court.
- Tapestry said it is working expeditiously to close the transaction in calendar year 2024.
- Tapestry described the FTC as the last regulator yet to approve the transaction.
- Tapestry's press release says the combined company would unite six brands: Coach, Kate Spade, Stuart Weitzman, Versace, Jimmy Choo, and Michael Kors.
- The filing includes forward-looking-statement cautions covering integration, synergy realization, employee retention, and the outcome of legal proceedings.
03—Questions
Frequently Asked Questions
What did the FTC do regarding the Tapestry–Capri merger?
On April 22, 2024, the Federal Trade Commission filed a complaint in the U.S. District Court for the Southern District of New York seeking to enjoin the merger.
What is the structure of the proposed transaction?
Under an Agreement and Plan of Merger dated August 10, 2023, Sunrise Merger Sub, Inc., a wholly owned subsidiary of Tapestry, will merge with and into Capri Holdings Limited, with Capri surviving as a wholly owned subsidiary of Tapestry.
How did Tapestry respond to the FTC lawsuit?
Tapestry issued a press release, filed as Exhibit 99.1, stating that the deal is pro-competitive and pro-consumer, that it has strong legal arguments, and that it looks forward to presenting them in court.
What timeline did Tapestry give for closing the deal?
Tapestry said it is working expeditiously to close the transaction in calendar year 2024.
Which regulatory approvals remain outstanding?
According to Tapestry's press release, the FTC is the last regulator yet to approve the transaction.
04—Continue