09:07 AM EDT, 04/17/2024 (MT Newswires) -- (Updates to add details throughout and recent stock move in the last paragraph.)

The Federal Trade Commission is preparing to sue to block Tapestry's (TPR) potential $8.5 billion takeover of Capri Holdings ( CPRI ) , NYT DealBook reported Wednesday, citing two unidentified people with knowledge of the matter.

The FTC is scheduled to discuss the matter next week and determine whether to proceed with legal action, DealBook said.

Tapestry, the maker of the Coach handbag, announced the deal in August 2023, under which it agreed to acquire Capri for $57 per share in cash. The deal, which has been cleared by European Union and Japan regulators, will bring together the brands Coach, Kate Spade, Versace, Jimmy Choo and Michael Kors.

Tapestry, Capri and the US FTC did not immediately respond to requests for comment by MT Newswires.

Tapestry's shares were 1.2% higher in recent Wednesday premarket activity, while Capri shares were 2.2% lower.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)