Ray-Ban heir proposes $33B buyout of family firm with Citigroup loan

Leonardo Maria Del Vecchio is proposing to purchase the remaining shares in Delfin Sarl, the holding company that controls the EssilorLuxottica eyewear empire, for approximately 3.7 billion euros. The offer, which values the family's combined holdings at roughly $33 billion, would allow the 31-year-old to increase his ownership stake from 12.5% to 37.5%.

The billionaire outlined the terms in a letter sent on Monday. He plans to buy out his five siblings, his half-brother, and his mother. Each co-owner would receive about $4 billion as part of the transaction. Del Vecchio stated that the proposal is backed by a nearly $25 billion loan from Citigroup, which carries an interest rate of 1.75%.

This move escalates a long-running dispute over control of EssilorLuxottica, the parent company of Ray-Ban, Oakley, and LensCrafters. The firm also holds stakes in major Italian banks, including UniCredit and Monte dei Paschi di Siena. Bloomberg reported that the firm's publicly disclosed stakes are valued at roughly $50 billion.

Del Vecchio is not the only bidder. Czech arms tycoon Michal Strnad, who Forbes estimates is worth $13.5 billion, also submitted a proposal for the company on Oct. 20. Strnad's offer was reportedly slightly higher than Del Vecchio's current bid. Both proposals seek to consolidate the fragmented ownership structure left by the late founder, Leonardo Del Vecchio, who died in June 2022.

The heir has been a vocal critic of EssilorLuxottica CEO Francesco Milleri. Del Vecchio has blamed Milleri for the company's recent stock decline, which has fallen more than 32% this year. The company's current market value stands at 86.91 billion euros, or over $97 billion. Del Vecchio argues that a dominant shareholder position will provide greater stability for the firm.

The board has previously rejected Del Vecchio's attempts to consolidate his holdings. He failed to win support for loans needed to buy out a combined 25% stake held by siblings Luca and Paola for 10 billion euros. His subsequent attempt to buy out half-brother Rocco Basilico was also denied. These rejections have pushed Del Vecchio toward a larger, single transaction to secure control.

In his letter, Del Vecchio said the new vehicle would implement strengthened governance rules and a binding statute. He plans to add two professionals with experience in management, law, and finance who will provide binding advice on key decisions. He stated that he is ready to present the full terms to stakeholders on Nov. 7.

The proposal comes amid personal scrutiny of the heir. Del Vecchio recently detailed a dispute with his ex-fiancée, Jessica Serfaty, over paternity tests that indicated he was not the father of her child. He told The Post that the allegations have damaged his reputation and complicated business dealings. He declined to specify which transactions were affected.

EssilorLuxottica did not immediately respond to a request for comment on the bid. The outcome of the negotiation will depend on whether the other seven co-owners accept the valuation and the proposed governance changes. The deal would transfer a massive amount of private equity into a single entity with significant external debt.