Prada is to buy the Genny Group, including its Byblos brand, the company said last week confirming rumours that have been circulating in the industry since the beginning of the year.

Prada would not disclose financial details, although a source close to the deal said Genny was bought for $125m.

Previous reports in the Italian press have said that the two groups' talks were limited to a production agreement, but by buying out Genny, Prada will add the smaller group's high-tech factories to bolster production capacity for its own stable of brands, which include Jil Sander and a 50 per cent stake in Fendi as well as its own Prada line.

Genny's factories, located in Ancona, can produce 150,000 units a season and have ample warehousing facilities.

The purchase of the Byblos brand comes as a surprise to some industry pundits, who thought it was being considered for acquisition by Sportswear International, which makes Byblos' jeans line Byblos Blu.

The Genny Group, which posted sales of has seen sales slide consistently since 1995. Byblos has gone through a string of designers - including Richard Tyler and John Bartlett - after its sales peaked in the early 1990s. In early March, Genny named Martine Sitbon as creative director for the women's line and Sandy Dalal for men's.