EssilorLuxottica

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EssilorLuxottica SA
Company type Société Anonyme
Euronext Paris:  EL
CAC 40 component
Euro Stoxx 50 component
ISIN FR0000121667
Industry Eyewear, Eye care
Predecessor Essilor
Luxottica
Founded1 October 2018;5 years ago (2018-10-01)
Headquarters
Paris
Key people
 Francesco Milleri (Chairman and Chief Executive Officer)
Products Ophthalmic lenses, optical equipment, prescription glasses and sunglasses
Brands Ray-Ban
Oakley
Persol
Varilux
Crizal
Transitions Optical
LensCrafters
Sunglass Hut
RevenueIncrease2.svg €24.494 billion (2022) [1]
Increase2.svg €3.230 billion (2022)
Increase2.svg €2.152 billion (2022)
Total assets Increase2.svg €60.561 billion (2022)
Total equity Increase2.svg €38.147 billion (2022)
Number of employees
149,000 (2020)
Subsidiaries Essilor
Luxottica
Website www.essilorluxottica.com
EssilorLuxottica's former logo used from 2018 to 2022 EssilorLuxottica logo.svg
EssilorLuxottica's former logo used from 2018 to 2022

EssilorLuxottica SA is an Italian-French vertically integrated multinational corporation based in Paris and founded on 1 October 2018 from the merger of the Italian Luxottica with the French Essilor. The eyewear-focused group designs, produces and markets ophthalmic lenses, optical equipment, prescription glasses and sunglasses.

Contents

EssilorLuxottica's merger agreement was that Essilor would acquire Luxottica, but Luxottica's leadership would gain seats in leadership and on the board of directors, including Luxottica founder Leonardo Del Vecchio becoming executive chairman. After a public feud between the previous companies' leadership, Del Vecchio was able to win the backing of shareholders and ousted Essilor CEO Hubert Sagnières from the company, appointing his choice of Francesco Milleri as the new CEO.

Upon the merger, the company became the largest player in the eyewear industry, with Essilor contributing numerous proprietary lens technologies as well as the brands Foster Grant and Costa Del Mar. For its part, Luxottica gave the company ownership over numerous eyewear brands including Ray-Ban, Oakley, Persol, Oliver Peoples, and Vogue Eyewear; eyewear retailers LensCrafters, Pearle Vision, and Sunglass Hut, eyewear insurance company EyeMed, and exclusive eyewear licensing deals to numerous fashion houses including Versace, Michael Kors, Prada, Coach New York, Ralph Lauren, Tory Burch, Armani, and Dolce & Gabbana. [2] The company is listed on the Euronext Paris stock exchange under the trading symbol EL and is part of the CAC 40 share index which includes the 40 largest capitalized companies traded on the Paris Stock Exchange and the Euro Stoxx 50 which includes the 50 largest companies in the Eurozone. According to Statista, in 2022, the company made €24.49 billion Euros in revenue. [3]

History

Merger of Essilor and Luxottica

In January 2017, Essilor and Luxottica announced the merger of their activities. After having received the necessary authorizations from the competition authorities of the United States, the European Union, Brazil, Canada and China, EssilorLuxottica was created on 1 October 2018. [4] On a technical level, Essilor acquired Luxottica, though Luxottica founder and executive chairman Leonardo Del Vecchio became co-leader of the new conglomerate, which would change its name to contain both companies. Luxottica proceeded to delist its American depositary receipts from the New York Stock Exchange upon announcement of the merger. [5] [6] [7] [8] [9]

Del Vecchio's holding company, Delfin, then held 62.42% of Luxottica, a share that it contributed to EssilorLuxotica. Delfin also became a plurality shareholder of the new group with 38.9% of the capital. [10]

This merger gives birth to a giant of the optical industry, generating a turnover of more than 16 billion euros and a market capitalization of 57 billion euros. [11] The merger did not occur without controversy from anti-trust researchers, however, and Turkish authorities, accusing the company of not fulfilling anti-trust obligations it had agreed to during the merger, fined EssilorLuxottica €17 million in late August 2023. [12] [13]

Internal war for leadership

Despite the merger being completed in 2018, the company still faced an internal leadership battle for control of the company, fought between old Essilor leadership and Del Vecchio, who went on to state in a March 2019 interview with Le Figaro that Essilor CEO Hubert Sagnières "only listened to himself", and had cost the company up to €600 million in savings from the merger. Sagnières responded to Del Vecchio by accusing the Luxottica founder of attempting to take control of the newly formed conglomerate without offering "a premium to shareholders" of EssilorLuxottica. Del Vecchio further accused Sagnières of inexperience when running an eyewear company. The terms of the merger provided that old Essilor leadership as well as Luxottica's officers would have equal control over the merged entity, though the company would select a new CEO, internally or externally, by the end of 2020. [14] [15] [16]

Ultimately, Del Vecchio won with the backing of EssilorLuxottica shareholders. Del Vecchio's choice of appointing Francesco Milleri as CEO and Paul du Saillant as deputy CEO. Saginères ultimately departed EssilorLuxottica after the feud, and Del Vecchio, who previously agreed to limit his voting rights to control the company, regained the full weight of such voting rights. A company statement to the Financial Times reflected the settled nature of the conflict, stating that the resolution of the leadership battle represented "the victory of a vision, the creation of an extraordinary business that is at the beginning of what it can achieve". Del Vecchio further reflected the new company's leadership by going on to state that his "life-long dream" of creating a dominant vertically integrated company in eyewear has "finally come true". [16]

Later acquisitions

At the beginning of 2019, EssilorLuxottica acquired German-based Brille24 GmbH. [17] Essilor's partner Shamir acquired Union Optic, a prescription laboratory that also distributes optical instruments. Essilor also acquired a majority stake in Indulentes, one of Ecuador's leading prescription laboratories, and a majority stake in Metalizado Optico Argentino S.A. (MOA), one of Argentina's leading prescription laboratories.[ citation needed ]

EssilorLuxottica acquired a 75% stake in the Dutch opticians group GrandVision, which owns Vision Express in the UK and For Eyes in the US, in 2019 for €28 per share, which would value the entirety of GrandVision at 7.2 billion euros. [18]

The eyewear giant additionally announced it would acquire Israeli startup Nuance Hearing for an undisclosed amount. This was the first major strategy shift and industry expansion for the company after Del Vecchio's 2022 passing, and it accompanied reports that the firm was planning to introduce hearing aid technology into its lenses. [19] [20]

2021 data breach

May 2023 saw EssilorLuxottica confirm that it had suffered a data breach two years earlier in 2021; upon noticing the breach, the company immediately alerted the FBI and Italian law enforcement. A spokesperson for the company stated that the company was first aware of the data breach in November 2022, and the owner of the website Have I Been Pwned? stated that around 77 million accounts were released. [21]

Operations and market dominance

The company dominates the global eyewear market as the largest single player in that market. [22] [23]

Retail

EssilorLuxottica is the largest company in retail sales, owning many of the largest eyewear retail chains in the world. By number of locations, EssilorLuxottica's largest store chain is Sunglass Hut, with 3,239 locations as of 2020. Its second largest and third largest chains are Oticas Carol at 1,402 locations and LensCrafters with 1,094 locations respectively. [24] Online, the company further owns Clearly, Eyebuydirect, FramesDirect.com, and online properties under its brand names such as Ray-Ban and Oakley. [25]

EssilorLuxottica retail brands by number of locations in 2020 [24]
Brand nameNumber of locations
Sunglass Hut 3,239
Óticas Carol1,402
LensCrafters 1,094
Pearle Vision 548
Target Optical 536
GMO447
Salmoirgahi & Viganò389
Oakley 384
OPSM 376
Ray-Ban 248
David Clulow Optical123
All others153

Eyewear brands

The company, inherited mostly from the Luxottica side, has control over some of the most recognized brands in eyewear. Previous acquisitions from Luxottica include Vogue Eyewear in 1990, [26] Persol in 1995, [27] Ray-Ban and Arnette in 1999, [28] [29] Oakley and Oliver Peoples in 2007, [30] [31] Alain Mikli in 2012, [32] and Bolon eyewear owner Xiamen Yarui Optical in 2013. [33] Essilor also brought some eyewear brands to the combined company, the largest of which being Foster Grant, acquired in 2010, [34] and Costa Del Mar, a part of Essilor since 2014. [35]

Despite ownership of brands, Luxottica also brought over exclusive eyewear manufacturing deals to the company, mostly with major European fashion houses. Armani was Luxottica's first major licensing deal in 1989, one that remains intact to this day, [36] and the company additionally manufactures eyewear for many companies, including but not limited to brands owned by Tapestry, Capri Holdings, Ralph Lauren Corporation, and Ferrari. [37]

In addition to the brands it owns, EssilorLuxottica presently has exclusive manufacturing licensing for Armani, Brooks Brothers, Burberry, Chanel, Coach, Dolce & Gabbana, Ferrari (through a Ray-Ban partnership), Michael Kors' eyewear, Miu Miu, Prada, Ralph Lauren, Swarovski, Tiffany & Co., Tory Burch, and Versace. [38] EssilorLuxottica also signed new licensing deals with Jimmy Choo and Kodak in 2023, though did not renew its license with LVMH-owned Bulgari, which expires at the end of 2023. [39] [40] [41]

Lens technologies

According to its website, [42] it owns the following lens technologies:

Related Research Articles

<span class="mw-page-title-main">Oakley, Inc.</span> Manufacturer of sports eyewear

Oakley, Inc. is an American company headquartered in Foothill Ranch, California, which is an autonomous subsidiary of EssilorLuxottica. The company designs, develops and manufactures sports performance equipment and lifestyle pieces including sunglasses, safety glasses, eyeglasses, sports visors, ski/snowboard goggles, watches, apparel, backpacks, shoes, optical frames, and other accessories. Most items are designed in house at their head office, but some countries hold exclusive designs relevant to their market. Oakley currently holds more than 600 patents for eyewear, materials, and performance gear.

Luxottica Group S.p.A. is an Italian eyewear conglomerate based in Milan. As a vertically integrated company, Luxottica designs, manufactures, distributes, and retails its eyewear brands all through its own subsidiaries. The company, presently organized as a subsidiary of EssilorLuxottica which formed when the Italian conglomerate merged with the French optical firm Essilor, is the world's largest company in its industry, both prior to and after its merger with Essilor.

<span class="mw-page-title-main">LensCrafters</span> American optician and eyewear retail chain

LensCrafters is an international retailer of prescription eyewear and prescription sunglasses. Its stores usually host independent optometrists on-site or in an adjacent store. The company has its corporate headquarters in Mason, Ohio, a suburb of Cincinnati in the US.

OPSM is a retailer of eye glasses in Australia and New Zealand, with locations in Hong Kong, Singapore, and Malaysia. It is owned by EssilorLuxottica, a French-Italian eyewear conglomerate.

Leonardo Del Vecchio was an Italian billionaire businessman, the founder and chairman of Luxottica, the world's largest producer and retailer of glasses and frames, with 77,734 employees and over 8,000 stores. At the time of his death, his net worth was estimated at US$24.1 billion, the second richest person in Italy, and 54th in the world.

<span class="mw-page-title-main">Persol</span> Eyewear company

Persol is an Italian eyewear brand specializing in the manufacturing of sunglasses and optical frames. It is one of the oldest eyewear companies in the world and is owned by the Luxottica group. The name is derived from the Italian per il sole, meaning "for the sun". Formed in 1917 by Giuseppe Ratti, Persol originally catered to pilots and sports drivers. Currently, the company markets durable sports sunglasses. The company trademark is a silver arrow.

Pearle Vision is an American chain of eye care stores. It is one of the largest franchised optical retailers in North America. The company was acquired by Luxottica, an Italian eyewear company, in 2004. As of December 31, 2018, Pearle Vision operated 110 corporate stores and had 419 franchises throughout North America.

<span class="mw-page-title-main">Essilor</span> French-based optics company

Essilor International is an international ophthalmic optics company that designs, manufactures and markets lenses to correct or protect eyesight. Its headquarters is in Charenton-le-Pont, France.

Foster Grant, or FosterGrant, is an American brand of eyewear founded by Sam Foster in 1919. The Foster Grant brand is a subsidiary company of FGX International, a consumer goods wholesaler with headquarters in Smithfield, Rhode Island, which has been owned by Essilor, today EssilorLuxottica, since 2010.

<span class="mw-page-title-main">Eyewear</span> Items and accessories worn on or over the eyes

Eyewear is a term used to refer to all devices worn over both of a person's eyes, or occasionally a single eye, for one or more of a variety of purposes. Though historically used for vision improvement and correction, eyewear has also evolved into eye protection, for fashion and aesthetic purposes, and starting in the late 20th century, computers and virtual reality.

<span class="mw-page-title-main">Safilo</span> Italian eyewear company

Safilo Group S.p.A. is an Italian company that designs, produces, and distributes prescription frames, sunglasses, sports eyewear, ski goggles and helmets, and cycling helmets under its own five house brands and 32 licensed brands, including Smith Optics since 1996.

Oliver Peoples is an American luxury eyewear brand established in 1986, and owned by Luxottica. The brand is sold in Oliver Peoples boutiques, online, and in fashion boutiques and department stores throughout the world. Oliver Peoples eyewear is designed in Los Angeles, Italy, and Japan.

<span class="mw-page-title-main">Hubert Sagnières</span> French businessman

Hubert Sagnières, born on 10 May 1955 in Vienne, France, is a company executive of French and Canadian nationality. He was chairman and CEO of Essilor International from 2012 to 2018 and became executive vice-chairman of EssilorLuxottica while keeping his role of chairman of Essilor International when Essilor merged with Luxottica in 2018.

Eyebuydirect, Inc. is an online retailer of prescription glasses, based in Austin, Texas. The company also sells prescription and non-prescription sunglasses, sport sunglasses, and computer glasses designed to reduce glare. Eyebuydirect was founded in 2005 by Roy Hessel, who was succeeded by Sunny Jiang, chief executive officer since 2017. The company has operations in the United States and China, and sells its products worldwide.

Frames Direct is an international online eyewear retailer. The company sells eyewear products such as eyeglasses, prescription sunglasses, sunglasses, and contact lenses through its website, https://www.framesdirect.com. Frames Direct sells designer and brand-name eyewear products with over 50,000 models. Founded in 1996, Frames Direct was one of the earliest online optical retail stores and the first to sell prescription sunglasses online.

Claudio Del Vecchio is an Italian businessman and billionaire. In April 2023, Forbes estimated his net worth around $3.9 billion.

<span class="mw-page-title-main">Clearly</span>

Clearly is an online retailer of contact lenses, eyeglasses and sunglasses. The company was acquired by EssilorLuxottica Canada, and is headquartered in Vancouver, British Columbia. They are one of the largest online contact lens retailers in North America, and the largest seller of prescription eyeglasses online in the world.

<span class="mw-page-title-main">Francesco Milleri</span> Italian businessman

Francesco Milleri is an Italian businessman, who has been the CEO of EssilorLuxottica since June 2022.

<span class="mw-page-title-main">Costa Del Mar</span> American sunglasses manufacturer

Costa Del Mar or simply Costa is an American manufacturer of polarized sunglasses based in Daytona Beach, Florida. It is a wholly owned subsidiary of EssilorLuxottica. Their sunglasses are popular in the sport sunglasses market, and are considered good for outdoor sports practicing, such as Summer activities, recreational fishing and boating. Costa's Baffin Sunglasses won Best of Show: Eyewear at ICAST 2018.

Xiamen Yarui Optical Co., Ltd, doing business as Bolon and Molsion, is a Chinese eyewear manufacturer. The company is headquartered in Xiamen.

References

  1. ↑ EssilorLuxottica (March 12, 2021). "Full year 2020 results" (PDF). EssilorLuxottica. Archived from the original (PDF) on March 12, 2021. Retrieved March 23, 2021.
  2. ↑ "Eyewear Brands | EssilorLuxottica". Essilor. Retrieved August 31, 2023.
  3. ↑ "EssilorLuxottica: revenue worldwide 2022". Statista. Retrieved August 31, 2023.
  4. ↑ "Essilor et Luxottica annoncent une fusion à 50 milliards d'euros". Investir. January 16, 2017. Retrieved May 21, 2019.
  5. ↑ "Essilor et Luxottica finalisent leur fusion, créant un nouveau géant de l'optique". Investir. October 1, 2018. Retrieved May 21, 2019.
  6. ↑ "Essilor, Luxottica close €48B merger to create eyewear giant". www.spglobal.com. Retrieved August 23, 2023.
  7. ↑ Zargani, Luisa (March 5, 2019). "Luxottica Delists From Milan Stock Exchange". WWD. Retrieved August 23, 2023.
  8. ↑ WW, FashionNetwork com. "Luxottica Group starts procedure for New York Stock Exchange delisting". FashionNetwork.com. Retrieved August 23, 2023.
  9. ↑ Prism, Optical (May 17, 2017). "Luxottica Group to delist from New York Stock Exchange". Optical Prism Magazine. Retrieved August 23, 2023.
  10. ↑ "EssilorLuxottica contrôle désormais 93,31 % des actions Luxottica". Zone bourse. November 28, 2018. Retrieved May 21, 2019.
  11. ↑ "16 milliards de CA pour EssilorLuxottica et des prévisions de croissance jusqu'à 5 %". Fréquence optic. March 8, 2019. Retrieved May 21, 2019.
  12. ↑ "EssilorLuxottica fined for non-compliance in Turkey". globalcompetitionreview.com. Retrieved August 30, 2023.
  13. ↑ Shedd, Karin (May 18, 2019). "Why the $49 billion merger of eyewear giants Luxottica and Essilor worries some antitrust experts". CNBC. Retrieved August 30, 2023.
  14. ↑ Kar-Gupta, Sudip; Henault, Blandine (March 21, 2019). "EssilorLuxottica tensions exposed as executives fall out". Reuters. Retrieved August 31, 2023.
  15. ↑ Wynne, Alex (March 21, 2019). "Merged EssilorLuxottica Plagued by Power Struggle". WWD. Retrieved August 31, 2023.
  16. 1 2 Borrelli, Silvia Sciorilli; Keohane, David (May 21, 2021). "EssilorLuxottica ends 3-year governance battle". Financial Times. Retrieved August 31, 2023.
  17. ↑ "Essilor acquires German online optical retailer Brille24". Ecommerce News. February 13, 2019. Retrieved August 31, 2023.
  18. ↑ "EssilorLuxottica sets sights on retail dominance with $8 billion GrandVision deal". Reuters. July 31, 2019. Retrieved August 23, 2023.
  19. ↑ Borrelli, Silvia Sciorilli (July 25, 2023). "EssilorLuxottica to move into hearing aids after buying Israeli start-up | Financial Times". Financial Times. Retrieved August 23, 2023.
  20. ↑ Wrobel, Sharon. "Maker of Oakley and Ray-Ban sunglasses buys Israeli hearing tech startup Nuance". www.timesofisrael.com. Retrieved August 23, 2023.
  21. ↑ "Luxottica confirms 2021 data breach after info of 70M leaks online". BleepingComputer. Retrieved August 23, 2023.
  22. ↑ Knight, Sam (May 10, 2018). "The spectacular power of Big Lens | The long read". the Guardian. Retrieved May 13, 2021.
  23. ↑ Parisi, Danny (May 16, 2019). "How independent eyewear brands compete with EssilorLuxottica". Glossy. Retrieved May 13, 2021.
  24. 1 2 "Number of stores of Luxottica by brand worldwide 2020". Statista. Retrieved September 5, 2023.
  25. ↑ Lazarus, David (March 5, 2019). "Column: How badly are we being ripped off on eyewear? Former industry execs tell all". Los Angeles Times. Retrieved May 13, 2021.
  26. ↑ "Strategy Study: How Luxottica Became The World's Eyewear Giant". www.cascade.app. Retrieved September 6, 2023.
  27. ↑ Ortiz, Gerald; Moon, Jacorey (June 5, 2023). "The Complete Guide to Persol Sunglasses: All Styles, Explained". Gear Patrol. Retrieved September 6, 2023.
  28. ↑ "Ray-Bans net cool $640 million in Luxottica sale - Apr. 28, 1999". money.cnn.com. Retrieved September 6, 2023.
  29. ↑ Earnest, Leslie (January 7, 2000). "Arnette Retires From Company He Founded". Los Angeles Times. Retrieved September 6, 2023.
  30. ↑ "Luxottica Acquires Oakley in $2.1 Billion Deal… | SGB Media Online". sgbonline.com. Retrieved September 6, 2023.
  31. ↑ "Oakley Acquires Oliver Peoples - a Leading Fashion Eyewear Brand". GlobeNewswire News Room (Press release). February 9, 2006. Retrieved September 6, 2023.
  32. ↑ Staff. "Luxottica Enters Into an Exclusivity Agreement to Acquire Alain Mikli". www.2020mag.com. Retrieved September 6, 2023.
  33. ↑ Grint, Louie (February 26, 2014). "Luxottica Is Destined to Win in 2014". The Motley Fool. Retrieved September 6, 2023.
  34. ↑ Essilor. "Essilor Acquires FGX International, Becoming a Major Player in a New Fast-Growing Market". www.prnewswire.com (Press release). Retrieved September 6, 2023.
  35. ↑ Bolar, Alim (November 19, 2013). "Costa Inc. To Be Acquired By Essilor International | VisionPlus Magazine" . Retrieved September 6, 2023.
  36. ↑ "EssilorLuxottica, Armani Renew Deal Which Changed Eyewear World". Bloomberg.com. September 14, 2022. Retrieved September 6, 2023.
  37. ↑ "Brands | EssilorLuxottica". Essilor. Retrieved September 6, 2023.
  38. ↑ "Eyewear Brands | EssilorLuxottica". Essilor. Retrieved September 6, 2023.
  39. ↑ EssilorLuxottica (June 29, 2023). "EssilorLuxottica and Jimmy Choo announce a ten-year licensing agreement". GlobeNewswire News Room (Press release). Retrieved September 6, 2023.
  40. ↑ Schneider, Jaron (July 28, 2023). "Kodak is 'Indefinitely' Licensing its Brand to the World's Largest Eyewear Company". PetaPixel. Retrieved September 6, 2023.
  41. ↑ WW, FashionNetwork com. "Luxottica and Bulgari are not renewing their eyewear license agreement". FashionNetwork.com. Retrieved September 6, 2023.
  42. ↑ "Brands".
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