MILAN — Eyewear manufacturing giant Luxottica Group SpA is about to get even bigger.

The Italian company said Thursday that it will buy Foothill Ranch, Calif.-based Oakley Inc. for about $2.1 billion, or $29.30 a share. Luxottica and Oakley said in a statement that the boards of both companies unanimously approved a “;definitive merger agreement” that “;combines two strong, complementary business models.”

Luxottica has focused on the high-end luxury and fashion eyewear segment through licensing deals with brands such as Prada, Versace, Chanel, Polo Ralph Lauren and Dolce & Gabbana. Luxottica also owns the Ray-Ban brand and posted 2006 sales of 4.7 billion euros, or $5.92 billion at current exchange.

Oakley specializes in sport eyewear and goggles, but also produces performance-related apparel, footwear and accessories. Its brand portfolio includes Dragon, Fox Racing, Oliver Peoples and Paul Smith Spectacles. Oakley’s sales last year totaled $761.9 million, with eyewear contributing $552.9 million.

Both companies have a retail presence in the eyewear market. Luxottica owns the LensCrafters, Pearle Vision and Sunglass Hut chains, among others. Oakley operates the Bright Eyes, Oakley Stores, Sunglass Icon and Optical Shop of Aspen.

Luxottica in recent years has snapped up optical retail chains in the U.S. and several other countries, including China, South Africa, Australia and Canada. The Oakley acquisition is Luxottica’s biggest to date.

Luxottica said the Oakley price represents a premium of about 18 percent over Oakley shares’ 30-day average trading price on the New York Stock Exchange and 24 percent over the shares’ three-month average trading price.

Pending approval from Oakley shareholders and regulators, the transaction is expected to close in the second half of this year.

Luxottica chairman Leonardo Del Vecchio hailed the acquisition as a “;milestone” for his company and said that Luxottica has long admired Oakley’s business and corporate culture.

“;Oakley and Luxottica share a mutual commitment to quality, innovation and technical skills — qualities which will help us to solidify Oakley’s brand position and Luxottica’s strong leadership in the market. I look forward to welcoming the talented Oakley management team, led by Scott Olivet and Colin Baden, to our group,” Del Vecchio said in a statement.

This story first appeared in the June 22, 2007 issue of WWD. Subscribe Today.

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Jim Jannard, founder and chairman of Oakley, said that he will make a “;substantial investment” in Luxottica after the transaction closes.

“;I have always had tremendous respect for Mr. Del Vecchio as a partner and competitor. I am very excited that we have found a way to join forces. Oakley’s technology and performance is one of the world’s best kept secrets and this partnership should empower our ability to tell our story throughout the world,” Jannard said.

The companies said they would benefit from about 100 million euros, or $134.3 million, in operating synergies through the merger. Together, the companies can create new eyewear categories and use Luxottica’s international platform to grow Oakley’s distribution.

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