Versace, the Italian fashion house founded by Gianni Versace 40 years ago, is set to be bought by Michael Kors.

The US fashion group has agreed to buy the Italian firm in a deal worth about €1.7bn ($2bn, £1.5bn), Reuters reported. The Versace family still owns 80% of the company. Four years ago it sold a 20% stake to US private equity group Blackstone.

Last year, Michael Kors bought Jimmy Choo, the luxury shoemaker founded in London, for almost £900m.

Donatella Versace, the firm’s artistic director and vice-president, has reportedly called a staff meeting in Milan for Tuesday, Corriere della Sera reported. Versace reported sales of €686m in 2016. Chief executive Jonathan Akeroyd said earlier this year that annual turnover was soon expected to exceed €1bn.

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