The Prada Group has agreed to buy rival Versace from the U.S. luxury group Capri Holdings in a deal valuing the Milan fashion house at 1.25 billion euros ($1.4 billion.

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The Prada Group announced a deal Thursday to buy Italy’s Versace from the U.S. luxury group Capri Holdings under terms that value the fashion house at 1.25 billion euros ($1.4 billion).