Eye-catching deal for Essilor

FRENCH corrective eye lens maker Essilor is to buy US group FGX International in a $565m (£345m) deal to boost its presence in the growing market for non-prescription reading glasses.

The deal, which includes repayment of FGX’s net debt of about $100m, is worth $19.75 per FGX International share and will boost Essilor’s earnings per share from next year, Essilor said.

Essilor’s chief executive designate Hubert Sagnieres said demand for non-prescription reading glasses was growing.

“The market fits well with our prescription lens business and is supported by favourable demographic trends. FGX will benefit from our international distribution network,” Sagnieres said.

Essilor, whose British base is in Bristol, operates in about 40 countries and employs about 400 people in the UK. Brands include varifocal lens Varilux, Airwear polycarbonate lenses, Crizal multiple coating lenses and Transitions photochromic lenses.

Smithfield, Rhode Island-based FGX International reported 2008 revenue of $256m, generated mainly in the US and Canada, and has about 375 staff. Its eyewear brands include Foster Grant, Magnivision and Angel.

Shareholders with about 33 per cent of FGX’s outstanding stock, including Berggruen Holdings North America and the firm’s senior managers, have agreed to back the deal, tipped to close in 2010, Essilor said.

The agreement includes a termination fee of about $18.3m payable by FGX to Essilor if FGX accepts a “superior unsolicited offer,” FGX said.