Luxottica will acquire Cole National
Luxottica Group and Cole National Corporation, today jointly announced that they have entered into a definitive merger agreement with the unanimous approval of the Boards of Directors of both companies.
Under the agreement, Luxottica Group will acquire all of the outstanding shares of Cole National for a cash purchase price of U.S. Dollar 22.50 per share, together with the purchase of all outstanding options and similar equity rights at the same price per share, less their respective exercise prices, for a total purchase price of approximately U.S. Dollar 401 million.
Leonardo Del Vecchio, Chairman of Luxottica Group, commented: 'This acquisition is a natural strategic move for Luxottica, as the addition of Cole National retail operations and brands gives us the opportunity to enhance our North American retail market offerings in product categories complementary to our LensCrafters and Sunglass Hut International operations. Moreover, we are eager to welcome Cole National into our Group, as we have been keen observers of its business turnaround and impressed with the accomplishments of its associates, franchisees, and affiliated doctors of optometry. It is these people who have driven the value created at Cole National, and we look forward to working with them. In addition, through the combination of Cole National with our retail and manufacturing operations, we expect to achieve significant synergies for the benefit of our customers and shareholders'.
Larry Pollock, President and Chief Executive Officer of Cole National, stated: 'During the past several months, a special committee of our Board has thoroughly examined a range of strategic options for our future. Our Board has decided that a combination with Luxottica, in addition to providing fair value for our shareholders, represents an excellent partner for Cole National associates, franchisees and affiliated doctors of optometry. We will have increased financial strength, greater resources to grow our brands, and new opportunities to build managed care relationships, all of which will benefit our associates, customers, and host partners'.
The merger is subject to the approval of Cole National's stockholders and the satisfaction of other customary conditions, including compliance with applicable antitrust clearance requirements. Therefore, the transaction is expected to close in the second half of 2004. Accordingly Luxottica Group noted that the transaction is expected to have only a marginal impact on its net earnings for the year.
Luxottica Group will fund the payment of the purchase price and transaction costs from cash flow and credit facilities to be available at the closing. At Luxottica Group's request, Mr. Pollock has entered into an agreement with Luxottica Group to vote his shares in favor of the merger.
Luxottica Group's financial advisor on the transaction is Goldman Sachs & Co., and its legal advisor is Winston & Strawn LLP. Cole National's financial advisor on the transaction is Lehman Brothers Incorporated, and its legal advisor is Wachtell, Lipton, Rosen & Katz.
Cole National will hold a conference call to discuss the proposed transaction with the Investment Community today, at 10:00 a.m., EST, 4:00 p.m., CET, 3:00 p.m., GMT. On the call Larry Pollock will give a brief presentation on the transaction, followed by a question and answer session. One or more members of Luxottica Group's senior management will participate in the call and be available to answer questions for Luxottica Group relating to the transaction.
Luxottica Group will hold its own conference call on January 30, 2004, at 8:00 a.m., EST, 2:00 p.m., CET, 1:00 p.m., GMT. to discuss fourth quarter results and the proposed transaction.
Cole National will file a preliminary and definitive proxy statement and other relevant documents concerning the proposed merger with the Securities and Exchange Commission. Cole National and its directors and executive officers and certain other of its employees may be soliciting proxies from stockholders of Cole National in favor of the proposed transaction. Information concerning the participants in the proxy solicitation will be set forth in the proxy statement when it is filed with the Sec.
Cole National Corporation's vision business, together with Pearle franchisees, has 2,197 locations in the U.S., Canada, Puerto Rico and the Virgin Islands and includes Cole Managed Vision, one of the largest managed vision care benefit providers with multiple provider panels and nearly 20,000 practitioners. Cole's personalized gift business, Things Remembered, serves customers through 728 locations nationwide, catalogs, and the Internet. Cole also has a 21% interest in Pearle Europe, which has 1,480 optical stores in Austria, Belgium, Denmark, Estonia, Finland, Germany, Italy, Kuwait, Norway, the Netherlands, Poland, Portugal, Russia and Sweden.
