Hubert Sagnières does not allow EssilorLuxottica to lead one-sidedly
We have all read the press release issued by Delfin and the interview of Mr. Del Vecchio in Le Figaro on March 20. Such attacks and this type of media campaign are unprecedented and unfounded.
I realize these publications will have been shocking for many of you and raised numerous questions, while unsettling stakeholders who approved and continue to support the combination between Essilor and Luxottica. The fact that this internal discussion has been made public to the media is regrettable, and is not in the best interests of the new Group.
At Essilor, we believe everyone in the world has the right to good vision, which leads to a full and productive life. Uncorrected poor vision is the world’s most widespread disability, and it affects more than 2.7 billion people today. Recently, myopia has become a global pandemic, and research estimates more than 5 billion people will be myopic by 2050. Additionally, as life expectancy increases, we will experience more than 3 billion presbyopes by 2050.
Until now, the optical industry remained fragmented with multiple leaders, but the combination of Essilor and Luxottica created one powerful industry leader capable of giving vision a louder voice, thereby transforming the industry and the world. Together, EssilorLuxottica embraces our mission to ensure everyone can see more, be more and live life to its fullest.
The combination of EssilorLuxottica is based on a number of core principles, reflected in the Business Combination Agreement (BCA) signed on January 15, 2017, and in the public documents that are the basis for the approval of this transaction. All stakeholders approved this combination: you; the works’ council during the consultation process; our shareholders, at the May 11, 2017, shareholders’ meeting; and the authorities, including the AMF, which granted to Delfin an exemption from mandatory tender offer requirements on that basis.
Among the core principles were, and are today, both a balanced governance with equal powers between Mr. Del Vecchio, as Executive Chairman, and me, as Executive Vice Chairman, and the absence of control of EssilorLuxottica by Delfin.
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. We staffed Essilor International (CGO) SA (now EssilorLuxottica) further to the hive-down in November 2017 of all activities of Essilor International (CGO) SA to Essilor International SAS. This was a requirement of the Combination Agreement to ensure that an appropriate management team required for a holding company of a listed group would be immediately in place. These executives benefit from a provision that allows them to be transferred back to Essilor International SAS if their employment agreements at EssilorLuxottica are terminated as a result of the hiring of joint executives.
To be clear, Luxottica representatives knew of this hiring 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.
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. He also wants to appoint Mr. Francesco Milleri as the CEO of EssilorLuxottica as stated several times.
In this position, Mr. Milleri would have authority to impose his management style and views and, as such, he would breach the agreement that we have collectively agreed to and adopted.
I assure you that I take seriously the responsibility to ensure that our agreed structure and commitments, as presented to our stakeholders and approved by them, are fully complied with. Any objective that does not align with the agreement contradicts the fundamental principles of the combination of Essilor and Luxottica. Though it brings together two unique companies in managerial culture and style, 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.
These controversies do not prevent us from continuing to work to implement the different actions necessary for the full integration of the two groups. This is being carried out with the support of McKinsey alongside over 20 joint working groups involving hundreds of employees around the world.
Together, we are building a unique Group in vision care with the best technology and the most loved eyewear brands. As we continue to progress along the aligned objectives of the BCA, we will deliver a stronger Group tomorrow for all of our 150,000 EssilorLuxottica employees, our shareholders and our customers who all expect and trust us to deliver on all our promises.
With my best regards,
Chairman of Essilor International
Source: Maïlis Thiercelin – Essilor Media Relations