** Shares of Versace owner Capri Holdings CPRI.N up 6% at $20.66

** Versace brand's chief creative officer Donatella Versace is to step down and former Prada's 1913.F Miu Miu executive Dario Vitale will take over role on April 1, Capri says

** Donatella's exit spurred talks of Versace's acquisition by Prada

** This follows reports that Prada is moving closer to a deal to buy Versace from Capri after agreeing to a price of nearly 1.5 billion euros ($1.6 billion)

** "I don't know if bringing in Dario Vitale is directly related to the potential sale to Prada, but it seems like it makes it even more likely" — Morningstar analyst David Swartz

** "Attracting Vitale as the chief creative officer could make Versace more attractive to Prada and, potentially, increase the selling price," he adds

** Earlier this year, sources told Reuters that Capri had been working with Barclays to explore a sale of its Versace and Jimmy Choo brands

** CPRI down about 58% in the past 12 months, during which Coach-parent Tapestry also pulled the plug on its $8.5 bln deal to buy Capri

(Reporting by Neil J Kanatt in Bengaluru)

((Neil.JKanatt@thomsonreuters.com))