EssilorLuxottica’s GrandVision Bid Gets EU Antitrust Nod
(Bloomberg) -- EssilorLuxottica SA won European Union approval to take over eyewear retailer GrandVision NV after agreeing to sell hundreds of stores, removing one obstacle to completing the deal as talks continue.
EssilorLuxottica agreed to sell the 35 stores of the GrandOptical chain in Belgium, 174 Italian stores and 142 stores in the Netherlands, the European Commission said in an emailed statement on Tuesday.
The EU’s blessing for the 7.3 billion-euro ($8.7 billion) deal comes after a rocky year for EssilorLuxottica, the world’s largest supplier of eyewear. Despite EU approval, the pandemic’s effect on retail and a legal spat with GrandVision have led EssilorLuxottica to consider its options, including renegotiating the price or even walking away from the transaction, people familiar with the situation have said. Under the deal terms, EssilorLuxottica could be liable for a 400 million-euro termination fee.
EssilorLuxottica said the outcome of the deal still awaits sign-off from competition authorities in Chile and Turkey “as well as the decisions regarding on-going litigations.” The company previously sued GrandVision for information over the performance of its stores since pandemic restrictions hit the retail trade last year.
GrandVision Chief Executive Officer Stephan Borchert said in a statement that approval was “a significant milestone.” The company added that it “continues to support EssilorLuxottica with the shared objective to close the transaction by July 31.”
EssilorLuxottica shares rose by 1.6% in Paris trading while the country’s benchmark index declined. GrandVision shares rose 1.5% in Amsterdam.
The EU said the store sales had allayed concerns over that merged firm could have prevented rival retailers from accessing its eyewear. It was also worried that the deal would have created the largest optical retailer in Italy, almost three times larger than its nearest competitor.
EssilorLuxottica initially sought to solidify its global market position by adding GrandVision’s European network. The proposed acquisition was slated to add more than 7,000 stores, selling lower-priced eyewear through chains such as Brilleland and For Eyes in more than 40 countries.
©2021 Bloomberg L.P.