Another Big Splash by Italy's Eyewear King
16 January 2017 - 4:41PM
Dow Jones News
By Manuela Mesco
MILAN-- Luxottica Group SpA's planned $49-billion tie-up with
France's Essilor International SA is the latest move in a lifetime
of deal making for Leonardo Del Vecchio, Luxottica's 81-year-old
founder and majority owner.
Mr. Del Vecchio started in 1961 what would become the world's
largest eyewear maker. He set up shop in the small northern town of
Agordo, where he was born and raised in an orphanage.
Initially, his company made glasses on contract for bigger
eyeglass companies. He later launched his own brands and then
embarked on a number of big acquisitions and licensing pacts
through the 1980s and 1990s. He bought retail chains in Italy and
struck licensing pacts with some of Europe's biggest luxury fashion
brands, including Giorgio Armani, Chanel and Prada.
He also pushed hard into the U.S., snapping up retail giants
Lenscrafters and Sunglass Hut. Luxottica dual-listed on the New
York Stock Exchange in 1990, where it trades under the ticker
symbol LUX.
In 1999, Mr. Del Vecchio bought Ray-Ban owner Bausch & Lomb.
At the time, the American brand that Audrey Hepburn and Tom Cruise
made a household name was languishing. Luxottica turned it around
again, improving the quality of its frames and restricting sales to
higher-end retailers.
In 2007, Luxottica made another big splash, buying Oakley, a
California-based maker of sports glasses, after a bitter
contractual dispute.
In the early 2000s, Mr. Del Vecchio took a step back from the
business, delegating power to a chief executive, Andrea Guerra. But
Mr. Del Vecchio grew tired of watching from the sidelines.
In early 2014, he bristled at Mr. Guerra's decision to join with
Google on its high-tech Google Glass. Mr. Guerra resigned that
year, and Mr. Del Vecchio returned to a more active role, naming
co-CEOs to run the business.
He turned heads with his own assessment of the ill-fated Google
Glass: "It would be OK in the disco, but I no longer go to the
disco," he said. Later the company said that he was making a joke
about his age.
Management turmoil and questions about succession followed Mr.
Del Vecchio's return. He personally took on direct management of
the company's marketing last year. Still, Mr. Del Vecchio's
controlling stake kept him firmly in charge.
His 62% ownership of Luxottica will fall to 38% of the combined
company. The deal calls for him to share power on the board, but
only during the three-year integration of the two companies,
according to people familiar with the matter.
Write to Manuela Mesco at manuela.mesco@wsj.com
(END) Dow Jones Newswires
January 16, 2017 11:26 ET (16:26 GMT)
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