Though rumors have been swirling that luxury brands Burberry and Coach are considering a merger — leading to a spike in both companies’ stock prices — inside sources say there aren’t any active discussions happening between the two companies at the moment.
On Friday, financial blog Betaville cited sources who said Coach was working with investment bank Evercore on a potential merger with Burberry.
Not so fast, those ever-mysterious “sources familiar with the matter” tell Reuters.
“This is completely speculative. There are no negotiations underway, Burberry is not talking to Coach,” one of the sources said.
Another person with knowledge of the situation said a merger isn’t in the stars, because the two companies have very different strategies.
“Contrary to Coach, most of the efforts at Burberry in the past 20 years have gone in the direction of elevating the brand and moving it into mega-brand price territory, rather than squarely into accessible luxury,” Exane BNP Paribas analyst Luca Solca wrote in a note. “A merger of Coach and Burberry would primarily be a merger of problems,” he said, adding that historically, mergers in the luxury category don’t usually help companies regain “brand traction and desirability.”
by Mary Beth Quirk via Consumerist
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