Back in August 2023, CPRI and TPR announced TPR’s takeover of CPRI for $57/share. The stock price initially jumped up to ~$54/share and has been in slow decline since then. It currently sits around ~$46. Part of this fall is due to the FTC’s second request for information for HSR purposes.
Given that most expect this deal to close this year and, if it does, the current price provides for a potential ~25% upside, it seems the risk is worth the reward.
It’s hard to imagine the FTC blocking this deal given that (1) the combined company would have roughly ~5% of the market, (2) the luxury handbag market is not one that requires strict consumer protection, and (3) the FTC seems to have its sights more focused on breaking up big tech, blocking any big oil mergers, and halting any large grocery store chain combinations.
What are your thoughts?
