In a billion dollar deal that shakes up the world of luxury fashion, Prada has agreed to buy Versace from its owner Capri Holdings.

The all cash deal, valued at $1.375 billion, will merge two of the most famous Italian luxury fashion brands under one roof. It is expected to close in the second half of the year pending regulatory approvals.

Capri said that it would use the cash from the deal to invest in its other brands, which include Jimmy Choo and Michael Kors. Prada also owns brands like Miu Miu, Churchs and Marchesi 1824. Both brands of course are staples of Hollywood fashion, outfitting stars on red carpets, debuting new pieces at fashion shows and leveraging the fame and fortune of the entertainment business to propel their own cultural relevance around the globe.

Versace is an iconic Italian fashion luxury house founded 46 years ago by Gianni Versace and further developed under the creative vision of Donatella Versace. Over the last six years, we have made tremendous progress in repositioning the brand to place greater emphasis on its luxury heritage and exceptional craftsmanship, said Capri CEO John D. Idol in a statement. Through elevated product, marketing and store enhancements, the brand is now well positioned for sustainable long-term growth. We are confident that Prada Group is the perfect company to further guide Versace into its next era of growth and success.

We are delighted to welcome Versace to the Prada Group and to build a new chapter for a brand with which we share a strong commitment to creativity, craftmanship and heritage, said Prada Group chairman Patrizio Bertelli. We aim to continue Versaces legacy celebrating and re-interpreting its bold and timeless aesthetic; at the same time, we will provide it with a strong platform, reinforced by years of ongoing investments and rooted in longstanding relationships. Our organisation is ready and well positioned to write a new page in Versaces history, drawing on the Groups values while continuing to execute with confidence and rigorous focus.