Handbag giant Coach buys Kate Spade for $2.4 billion

NEW YORK -- The company behind Coach handbags recently made a big purchase.

Coach announced Monday that it would be buying rival Kate Spade for $2.4 billion.

Coach's CEO said the deal would give the company a way to reach younger consumers and drive long-term sustainable growth.

"Kate Spade has a truly unique and differentiated brand positioning with a broad lifestyle assortment and strong awareness among consumers, especially millennials. Through this acquisition, we will create the first New York-based house of modern luxury lifestyle brands, defined by authentic, distinctive products and fashion innovation," Coach CEO Victor Luis said. "In addition, we believe Coach's extensive experience in opening and operating specialty retail stores globally, and brand building in international markets, can unlock Kate Spade's largely untapped global growth potential. We are confident that this combination will strengthen our overall platform and provide an additional vehicle for driving long-term, sustainable growth."

Coach is expected to keep the Kate Spade brand, but would be cutting back online flash sales and wholesale offerings.

The deal comes after Coach's $547 million acquisition of Stuart Weitzman, a designer shoe company.

Report a typo to the ABC13 staff