MILAN — A little more than a year after the announcement of the Essilor and Luxottica proposed merger in January 2017, the European Commission and the U.S. Federal Trade Commission have cleared the project without conditions.
To date, the transaction has been unconditionally approved in 13 other countries: Australia, Canada, Chile, Colombia, India, Japan, Mexico, Morocco, New Zealand, Russia, South Africa, South Korea and Taiwan.
China is the remaining jurisdiction where antitrust approval is still pending. Brazil gave the green light last week, which will be ratified over the next few days.
The merger is expected to be finalized in the first part of this year.
The Italian group produces eyewear under license for names including the Giorgio Armani Group, Bulgari, Burberry, Chanel, Coach, Prada and Versace and also has a number of owned brands, such as Ray-Ban, Oakley and Persol. It and Essilor, the leading maker of lenses worldwide, have agreed to a 46 billion euro, or $48.7 billion, merger to form an eyewear powerhouse with annual sales of more than 15 billion euros.
Luxottica and Essilor combined will have more than 140,000 employees and sales in more than 150 countries.
In the new entity, Luxottica founder Leonardo Del Vecchio will serve as executive chairman and chief executive officer and Hubert Sagnières, Essilor’s chairman and ceo, will become executive vice chairman and deputy ceo. Del Vecchio and Sagnières will also keep their positions of executive chairman of Luxottica and chairman and ceo of Essilor International, respectively.
As reported, a lower cost of debt, fiscal benefits from Italy’s Patent Box regime and the effects of tax reform in the United States boosted Luxottica Group SpA’s profits in 2017. Luxottica said adjusted net income rose 10 percent, at current exchange rates, to 970 million euros. The company confirmed its previously released turnover figures for the just-ended full year: 9.15 billion euros, up 0.8 percent, at current exchange. At constant currencies, 2017 revenues increased 2.2 percent. The company mentioned there were some 18.5 million euros in nonrecurring costs related to the Essilor combination.
“We continue to conduct open and constructive dialogue with governments which have not yet taken up the issues,” said Alessandra Senici, the group’s head of investor relations, commenting on the figures, adding that the company expected the merger to be cleared “within the first half of this year.”