Essilux, France rises to 4%. 600 million investment

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The French state strengthens its stake in EssilorLuxottica. According to what was reconstructed by Il Sole24 Ore, the Caisse des Dépôts et Consignations (CDC), a French public institution which corresponds to the Italian Cassa e Depositi e Prestiti, communicated to the eyewear group that it had individually exceeded the threshold of 2% of the capital through purchases on the market. The investment, of over 600 million, leads the financial arm of the Elysée to directly hold 2.41% of Essilor Luxottica and consequently the CDC-Bpifrance aggregate rises to 4% of the capital. This is a significant package that reaffirms the centrality of Essilor Luxottica for the French system and strengthens the French soul in the eyewear giant’s shareholder register. All this in view of the meeting at the end of the month of the group controlled with 32.5% by Delfin of the Del Vecchio family called to renew the board and top management.

Bpi’s position

The French Government’s position in Essilor Luxottica was built in several steps. The entry took place in 2021 exactly at the expiry of that joint Italy-France agreement which paved the way for the merger between Essilor and Luxottica. On that occasion Bpifrance, the French public investment bank controlled by the Caisse des Dèpôts et Consignations and by Epic, another transalpine government body, announced that it had made its entry into the capital of EssilorLuxottica through the Lac1 funds, obtaining from the group’s board of directors of the eyewear industry the right to indicate a candidate on the board, José Gonzalo, executive director of Bpifrance. No official indication on the share, but only assumptions that gave the organization around 2% of the capital.

The CDC roundup

However, Bpi did not move alone, as was the story in financial circles at that juncture. Together with the public bank, Cdc, various sources reported, was also accumulating direct positions in the Italian-French group, despite remaining below the communication threshold of 2%. Rumors that have never been confirmed. Until now. Because in the registration documents of the meeting of April 30 it turns out that the CDC itself has now exceeded the threshold of 2% of Essilor’s capital: «On June 6, CDC notified the company that on June 1, 2023, the Caisse des Dépôts et Consignations (The CDC), has directly and individually exceeded the statutory threshold of 2% of the capital and voting rights of the EssilorLuxottica Company”, we read in the registration dossier. «This overcoming results from the acquisition of securities on the Market, directly from CDC. The CDC group now holds directly and indirectly through CNP Assurances and LBP Prévoyance 10,793,060 shares and voting rights of the Company representing 2.41% of the capital and voting rights.” In practice, CDC chose to come out in the open by exceeding the communication threshold, with purchases involving at least 0.6% of the capital or probably more. A package which, considering EssilorLuxottica’s 92 billion capitalization, involved an investment of over 600 million euros.

Transalpine banks

The latest purchases from the Elysée thus go towards defining and consolidating the position of the French state in the eyewear group. Together with Cdc we must add the share of Bpifrance which, according to what was reconstructed by Il Sole24 Ore, is equal to 1.5%. Therefore, the CDC – BPI axis can now count on 4% of the group’s capital.

A French presence which on paper doubles if we consider the 4.3% of the capital in the hands of the Valoptec association, even if in this regard it should be remembered that the DNA of that same association born within Essilor alone has today changed profoundly and has not transalpine passport. Supporting the public axis in EssilorLuxottica, however, there are certainly large institutions that are expressions of the Parisian territory. Among these, according to Bloomberg calculations, Credit Agricole stands out with 0.87%, Natixis at 0.53%, BNP Paribas with 0.45% and Comgest at 0.74%. Therefore, just to mention the most significant positions, it is 2.6% of the capital in the hands of French institutions.