Fashion companies Capri Holdings Limited and Tapestry -- parent companies behind the Coach and Michael Kors brands -- ended their $8.5 billion merger deal Thursday. The deal was blocked by the Federal Trade Commission.

The parent companies of brands such as Coach, Kate Spade, Versace and Michael Kors decided not to proceed with a court battle.

Tapestry, Inc. (NYSE:TPR) shares are trading higher premarket on Thursday after the company disclosed that it has reached an agreement with Capri Holdings Limited (NYSE:CPRI) to terminate their merger agreement.

Now Capri is pressing forward with a revamp that will include store closures and a marketing push for its Michael Kors brand.

Tapestry—the owner of luxury brands such as Kate Spade and Coach—and Capri—owner of Michael Kors, Versace and Jimmy Choo ended their merger efforts after a federal lawsuit sought to block the deal.

Capri Holdings Ltd and Tapestry Inc. have ended an $8.5 billion plan to merge after a US court order freezing the deal due to US antitrust regulators’ objections.

Capri Holdings (CPRI) and Tapestry, Inc. (TPR) have terminated their $8.5B merger deal due to regulatory challenges.