Essilor’s Sagnieres Seeks to Reassure Staff That Governance Issues Will Not Derail Merger with Luxottica

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PARIS—Essilor chairman Hubert Sagnieres sought to reassure his staff that the company’s recent merger with Luxottica is proceeding as planned, despite a heated dispute with Luxottica’s founder Leonardo Del Vecchio over the governance of the new company that burst in public view last week. In a letter sent yesterday to Essilor managers, Sagnieres said, “I firmly believe the combined EssilorLuxottica remains a formidable partnership. I will continue to ensure we accelerate operational efficiencies rather than becoming derailed by governance matters that often only reflect personal ambitions. The search for a future CEO of EssilorLuxottica is a priority for the success of the Group, and I give my full support to this effort. We must dedicate our energy to integrating the two businesses, under strong leadership, and implementing the synergies that we have promised to the market.”

VMail reported last week that differences had emerged around management and governance issues governance issues for EssilorLuxottica.

Despite accusations by Del Vecchio that Essilor has violated the terms of its merger agreement with Luxottica, Sagnieres asserted in the letter that Essilor, is, in fact, honoring the terms of the agreement. He also accused Del Vecchio of seeking to take control of the company by appointing Luxottica’s CEO, Francesco Milleri to head EssilorLuxottica.

Sagnieres stated in the letter, “Recent statements by Mr. Del Vecchio in the press claiming Essilor has breached the Combination Agreement by hiring four key executives, thereby blocking the appointment of joint key executives, are unfounded and reflect an attempt by Delfin to destabilize Essilor.” Sagnieres said Essilor staffed the newly combined company, EssilorLuxottica, as part of a required “hive-down” in November 2017 during a transitional period of the merger, and that Luxottica representatives knew about the hirings at the time of the closing of the transaction in October 2018.

“Recent media reports suggest special arrangements were made for these individuals. However, there is no ‘golden parachute,’ no ‘blocking of positions,’ and no ‘violation of the Combination Agreement.’ Delfin’s statements are simply inaccurate,” Sagnieres said.

Sagnieres repeated in the letter his earlier claims that, “Despite denials by Delfin and its representatives, it has become clear that Mr. Del Vecchio wants to take control of EssilorLuxottica without paying a premium to the shareholders.”

Nevertheless, Sagnieres remains bullish about the merger. “These controversies do not prevent us from continuing to work to implement the different actions necessary for the full integration of the two groups,” he said in the statement. He added, “This is being carried out with the support of McKinsey alongside over 20 joint working groups involving hundreds of employees around the world.”