Delfin Calls for Arbitration on EssilorLuxottica Merger

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LUXEMBOURG—The war of words between Luxottica founder Leonardo Del Vecchio and Essilor chairman Hubert Sagnieres over issues involving the governance of the newly merged EssilorLuxottica is turning into a legal battle. Luxottica holding company Delfin announced yesterday that it has filed a request for arbitration at the International Chamber of Commerce in order to resolve the increasingly contentious situation. Del Vecchio claims that Essilor has violated the terms of the 2017 merger agreement between the two companies by hiring four key executives, thereby blocking the appointment of joint key executives.

Sagnieres has accused Del Vecchio of seeking to take control of the company “without paying a premium to the shareholders” by appointing Luxottica’s CEO, Francesco Milleri, to head EssilorLuxottica.

Delfin’s announcement follows Essilor’s release yesterday of a letter from Sagnieres to his staff, in which the Essilor chief sought to reassure them that the dispute will not derail the merger agreement.

EssilorLuxottica (Reuters: ESLX.PA) shares dropped 2.0 percent by 9:55 a.m. EST, among the worst performers on Paris’ benchmark CAC-40 index. The stock has fallen over 10 percent so far in 2019.