Update Monday, May 8 at 3:07 p.m. EDT: This story was updated to say Kate Spade & Co. has been a standalone company since 2014 when it dropped Fifth & Pacific from its name. Originally, the story said Kate Spade & Co. was owned by Fifth & Pacific, which used to be called Liz Claiborne.

Original story: 

Did you know fashion designer Kate Spade was related to Hollywood actor David Spade? It’s true! Some fans started to wonder about the Spade family history and riches after it was announced Monday that Coach Inc. was slated to purchase the luxury handbag and accessories retailer for $2.4 billion at $18.50 a share.

Kate and David aren’t biologically related: She is married to the actor’s older brother, Andy. While the “Joe Dirt” star has an estimated $40 million net worth, Kate eclipses his riches with a reported net worth of $200 million, according to Celebrity Net Worth.

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Kate Spade & Co. was valued at $3.1 billion by Forbes in May 2016. They were listed at No. 66 for innovative growth companies.

Kate and Andy co-founded Kate Spade & Co. in 1993 and sold the company in 2006 for $59 million. For a short time it was owned by Fifth & Pacific, which was previously known as Liz Claiborne, but, once again, Kate Spade & Co. became a standalone company, dropping the Fifth & Pacific name in 2014.  

The couple never intended to be fashion designers. “Why don't you do handbags? You love handbags,” Andy mused to Kate in the ‘90s, according to Women’s Wear Daily. “We never thought about starting a company. We just said, ‘Let’s make some bags and see what happens.’”

Rumors about Kate Spade & Co. being first circulated in December.

Coach Inc. agreed to buy its rival, with the goal of attracting younger consumers, the Wall Street Journal reported Monday. “Kate Spade has the highest penetration among millennials within our competitive set,” Coach Chief Executive Victor Luis told the Journal. “Millennials offer a market that is substantial in terms of size and allows us to recruit younger customers.”

There hasn’t been much of a pop in the handbag industry, with the market slowly to a growth of 2 percent. Six years ago, the market saw an increase of 15 percent, Craig Johnson, an analyst at Customer Growth Partners, told the Journal Monday.

“Kate Spade has a truly unique and differentiated brand positioning with a broad lifestyle assortment and strong awareness among consumers, especially millennials,” the Coach CEO said in a statement Monday, according to CNBC.com.

After acquiring Kate Spade & Co., Coach Inc. reportedly wants to target a slightly older and wealthier clientele. “Consumers continue to shift dollars away from apparel to handbags, accessories and footwear,” he said.

As for Kate Spade’s future, Luis wants to expand to company to Europe and China, where there aren’t as many stores.

The merger was beneficial to both companies in the stock market. Kate Spade shares jumped to 8 percent higher and Coach’s stock rose 6 percent.

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" ... This is a sensible deal both in terms of the brand fit and the premium that Coach is paying," GlobalData Retail analyst Neil Saunders told CNBC about the deal. “Ultimately the aim for Coach is to become a business with a portfolio of distinct and compelling luxury brands. Today's announcement is the solid step on that journey.”

But the transaction isn't set in stone, yet. Either company can back out by Feb. 7, 2018.

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