EssilorLuxottica's Warring Sides Sign Settlement Agreement-- Update
May 13 2019 - 3:59AM
Dow Jones News
By Cristina Roca
The two warring sides of EssilorLuxottica SA (EL.FR) have broken
a monthslong deadlock on a governance dispute and struck a peace
deal just a few days before the company's annual general meeting
takes place on Thursday.
The optical company and its main shareholder Delfin said Monday
that they have signed a settlement agreement and that all legal
disputes between them will be dropped.
EssilorLuxottica Chairman Leonardo Del Vecchio and Vice-Chairman
Hubert Sagnieres agreed to give powers to the chief executives of
the Essilor and Luxottica businesses, Laurent Vacherot and
Francesco Milleri respectively, to work on a strategy and
integration process at EssilorLuxottica within the next 12 to 24
months. Mr. Vacherot and Mr. Milleri have signed off on key staff
appointments to lead the company's central functions, the company
said.
Investors welcomed the news: At 0714 GMT, shares in
EssilorLuxottica traded 4.4% higher at EUR115.05.
EssilorLuxottica's chair and vice-chair share, under the terms
of the merger of Essilor and Luxottica last October, equal powers.
They have been locked in a governance dispute for months, delaying
the delivery of synergies from the combination of the two
businesses as well as the search for a CEO for the new company.
Mr. Vacherot has been appointed a director on the company's
board, replacing Bernard Hours, who resigned from his post. Mr.
Milleri was already a board member. This leaves the power balance
at EssilorLuxottica's board, where Essilor and Luxottica each
control eight seats, unchanged.
The board of EssilorLuxottica confirmed the search for a new
chief executive and Mr. Milleri and Mr. Vacherot told the board
they would not run for the position, the company said.
As a result of the decision, Valoptec, the association of
EssilorLuxottica shareholders, has withdrawn its proposal to
appoint an additional director on the company's board, which was to
be voted on during the shareholders' meeting on Thursday.
The agreement ends all existing claims and legal proceedings
between EssilorLuxottica and Delfin, the holding of Mr. Del
Vecchio, who merged his Luxottica business with Essilor via a
complex share-swap that ended with him holding 31% of voting rights
in EssilorLuxottica through Delfin.
Write to Cristina Roca at cristina.roca@dowjones.com;
@_cristinaroca
(END) Dow Jones Newswires
May 13, 2019 03:44 ET (07:44 GMT)
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