EssilorLuxottica and Delfin have signed a settlement agreement to solve the governance issues that have plagued the merger thus far. The agreement seems to pave the way to accelerate the integration process.
According to a statement from EssilorLuxottica, the agreement—which establishes an equal-powers governance—settles any dispute between the parties. As reported previously here by EB, the full integration of Essilor and Luxottica turned rocky as the leaders of Essilor and Luxottica (Hubert Sagnières and Leonardo Del Vecchio) had been accusing each other of defying the merger agreement.
- Leonardo Del Vecchio and Hubert Sagnières empowered Francesco Milleri (deputy chairman and CEO of Luxottica Group) and Laurent Vacherot (CEO of Essilor International) with the responsibility to develop and implement the EssilorLuxottica strategy and integration process, accelerating the simplification of the new Group by integrating the two operating companies within the next 12 to 24 months
- Milleri and Vacherot approved the appointment of key executives for the Group’s central functions
- Vacherot has been appointed as a Director of EssilorLuxottica, replacing Bernard Hours, who has asked to be relieved of his office. He will also become a member of the Board's Strategy Committee
- The Board confirmed the search for a new CEO. Milleri and Vacherot have informed the Board that they are not candidates for this position.
As a result of this agreement, all existing claims will be waived and legal proceedings will be terminated, including the request for arbitration filed by Delfin before the International Court of Arbitration of the International Chamber of Commerce on March 27.
In light of this agreement, Valoptec decided that it will withdraw the proposal submitted on April 18 for the appointment, at the Shareholders’ Meeting set for May 16, of one additional Director of EssilorLuxottica and will vote against the proposals submitted by certain institutional investors for the appointment of two additional Directors. The representative of Valoptec at the Board of EssilorLuxottica will integrate the Strategic and the Integration Committees of the Company.
As previously stated, the Board recommends that the shareholders vote against all the remaining proposed additional resolutions which, if approved, would result in a clear breach of the Combination Agreement and in a potential disruption for the activities of the Board.