Sep 4, 2017
EU Commission promises in-depth examination of Essilor-Luxottica merger
Sep 4, 2017
The European Commissioner for Competition, Margrethe Vestager, speaking at the Ambrosetti European forum in Italy, said that the merger between Luxottica and Essilor will be examined closely by the EU anti-trust authority.
In January, Italian group Luxottica, the world's premier eyewear frame manufacturer, owner among others of the Ray-Ban label, and French group Essilor, the world number one in ophthalmic optics, announced their merger project, designed to create an industry leviathan with a revenue of over €15 billion and a stock market capitalisation of €47 billion.
The operation takes the form of an incorporation of Luxottica by Essilor, and is expected to be finalised before the end of the year, though before then the two groups will need the green light from competition watchdogs in several countries.
The operation was officially notified to the EU authority on 22nd August, and Margrethe Vestager said it is too early to say whether Essilor and Luxottica will need to make any adjustment in order to have the EU's go-ahead for the operation.
"Both groups hold very significant shares in markets, those of sunglasses and optical glass, which are of considerable size, and I cannot say anything at the moment," said Vestager. "Even in the case of a vertical integration like this one, when market shares of such magnitude are involved (...) an in-depth analysis is necessary," she added.
A vertical integration between two corporations operating at different stages of the manufacturing chain is in principle less problematic for anti-trust regulators than a horizontal merger, which increases a group's overall market share. But the EU Commission will try to ascertain whether the proposed merger could prevent or hinder market access to any supplier or buyer within the industry.
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