EssilorLuxottica

EL
Real-time Euronext Paris - 06/20 05:12:52 pm
112.6EUR
+0.9%

EssilorLuxottica : No CEO in sight…

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05/16/2019 | 05:19 pm
Since the merger of French optical lens giant Essilor and Italian eyewear manufacturer Luxottica, the French and Italian sides have been fighting for the control of the new entity. They now seem to be heading towards a truce… but we shouldn’t expect to see a new CEO anytime soon.
In 2018, the merger of Essilor and Luxottica created the world leader in optics. But in the following months, each side has accused the other of wanting to take over. Leonardo Del Vecchio, founder of Luxottica, and Hubert Sagničres, President of Essilor, had a difficult relationship, with both men not used to share power.

They finally reached a compromise on May 13...

The group stated in a press release that Del Vecchio and Sagničres delegated responsibility for implementing EssilorLuxottica's integration process to their respective right-hand men, Francesco Milleri and Laurent Vacherot. It annouced that it is searching for a new CEO, noting that neither Milleri or Vacherot would be running for this position.

But the search for a new CEO might be a long one

At the general shareholders' meeting on May 16, it appeared that the profile of the candidate was not clearly established, and it is not clear whether the candidate would be coming from the outside or from within the group. During the session, investors asked the extent to which Mr Del Vecchio and Mr Sagničres have agreed on the new CEO profile, but no clear answer was given.

Leonardo Del Vecchio said that it would be "really difficult" to find a CEO by the end of 2020 as planned and said he would prefer internal recruitment. "I have spoken to these two consulting firms, I have already been presented with a candidate and I said no," Mr. Del Vecchio said on Thursday, quoted by news agency AFP. "Hiring a lawyer or a financier, if he doesn't know anything about glasses or glasses, it wouldn't do us any good."

Despite these tensions over governance, the group recorded a solid performance in the first quarter. Sales jumped by 7.5 percent from the year-ago quarter to Euro 4,210 million:


Both Sagničres and Del Vecchio sought to reassure investors on the solidity and durability of the merger : “In the near future, we will continue to build our success on the strength of our brands, operational excellence and ever-increasing digitalization of the Group," said Del Vecchio, while Sagničres concluded: “Joint integration work is now solidly underway in many key areas such as the complete pair, leveraging the company’s own retail, cross-selling in wholesale, optimizing the supply chain, enhancing efficiency and growing the market.”
Romain Fournier
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