Kibbutz Shamir, Israel and Charenton-le-Pont, France [0ctober 15, 2010 - 8:30
a.m. CES T] - Shamir Optical Industry Ltd. (Nasdaq: SHMR) ("Shamir Optical"),
Kibbutz Shamir and Essilor International (NYSE Euronext: EI) ("Essilor") today
announced that they have signed an agreement whereby Essilor will, through a
series of transactions, acquire 50% of Shamir Optical. As a result of these
transactions, Kibbutz Shamir and Essilor will each own 50% of Shamir Optical.
Headquartered in Kibbutz Shamir, Israel, Shamir Optical is a fast growing
provider of innovative products and technology to the ophthalmic lens industry.
Shamir Optical reported 2009 revenues of $142 million, generated mainly in
Europe and the United States, and has approximately 1,400 full-time employees.
Amos Netzer, Chief Executive Officer of Shamir Optical commented "This venture
places Shamir Optical in a position to accelerate the development of new
products and to strengthen its presence in the market place by using Essilor's
R&D capabilities, notably in coatings, and its worldwide distribution network.
The transaction will create synergies and provide Shamir Optical with additional
resources to invest in its development."
Hubert Sagnières, Essilor's Chief Executive Officer said "This joint venture
represents a strategic addition to Essilor's business and will strengthen our
offer to the mid-tier segment with additional high-quality products. Shamir
Optical's range of products fits closely with Essilor's. Thanks to our existing
network, respective expertise and the potential for vertical cost synergies, our
partnership will allow us to grow the worldwide optical business with
innovative, new value-added products and services and to expand our offer to
eyecare professionals around the world. Shamir Optical will continue to produce
and promote its brands, products and services as a separate business entity."
Under the planned transaction, Shamir Optical will be delisted from the Nasdaq
Global Market and the Tel Aviv Stock Exchange through a merger with a wholly
owned subsidiary of Essilor by which all shareholders other than Kibbutz Shamir
will receive cash for their shares. Essilor will simultaneously acquire for cash
additional shares directly or indirectly from Kibbutz Shamir in order to reach
50% of Shamir Optical. The price offered for each transaction is $14.5 per
Shamir Optical share. This price, together with the dividend of $0.804 payable
to Shamir Optical shareholders of record on 8th November 2010, represents a
total value of $15.3 per share, corresponding to a 57% premium over the last 90
day average closing share price on Nasdaq of $9.75. The transaction will
represent a cash investment of $130 million for Essilor, to be fully financed
using Essilor's existing committed credit facilities.
Shamir Optical's Board of Directors and its Audit Committee have unanimously
approved the terms of the proposed transaction and Shamir Optical's Board of
Directors has recommended it to Shamir Optical Shareholders. Certain
shareholders representing approximately 69.3% of Shamir Optical's outstanding
capital, including Kibbutz Shamir, have signed support agreements committing to
vote in favour of the transaction at the special meeting of shareholders that
will be called to approve the transaction.
Under the terms of the agreements between Essilor and Kibbutz Shamir, the
existing management team of Shamir Optical will remain in place.
The transaction, which is subject to regulatory approvals, rulings, the approval
of Shamir Optical's shareholders in accordance with Israeli law and the approval
of the district court of Nazareth, Israel, is expected to close in mid 2011.
The Merger Agreement contains certain termination rights for both Essilor and
Shamir Optical and further provides that, upon termination of the Merger
Agreement under specified circumstances, Shamir Optical may be required to pay
Essilor termination fees of $11 million.
Shamir Optical expects to send its shareholders a shareholder information
statement and proxy materials in connection with the meeting at which Shamir
Optical's shareholders will be asked to approve the proposed merger. Shamir
Optical's shareholders are urged to read the shareholder information statement
and proxy materials, when they become available, because they will contain
important information (see below, "Where You Can Obtain Further Information").
Essilor will fully consolidate Shamir Optical upon closing. Based on current
estimates, the transaction is expected to be accretive to Essilor's earnings per
share as of 2011 (before impact of the purchase price allocation).
This news release is provided for information purposes only and does not
constitute an offer to purchase any security, nor is it a solicitation of any
vote or approval in any jurisdiction. Shareholders of Shamir Optical should be
aware that the consummation of the merger proposal is subject to various
conditions, including the requisite shareholder vote described above, and
therefore the merger proposal may not be consummated. Persons who are in doubt
as to the action they should take should consult their stockbroker, bank
manager, attorney or other professional advisers.
Where You Can Obtain Further Information
Details of the merger proposal will be contained in a document (the "Information
Statement ") to be mailed to the shareholders of Shamir Optical in due course.
In addition, since the merger proposal constitutes a "going private transaction"
subject to the requirements of Rule 13e-3 under the U.S. Securities Exchange Act
of 1934, a Schedule 13E-3 will be filed as required with the United States
Securities and Exchange Commission (the "SEC"). All shareholders are urged to
read the Schedule 13E-3, the Information Statement and any other definitive
materials accompanying those documents before casting any vote at (or providing
any proxy for) the special meeting of the shareholders. Shareholders may obtain
such documents free of charge when they are furnished to the SEC and become
available at the Web site maintained by the SEC (http://www.sec.gov).
About Shamir Optical
Shamir Optical is a leading provider of innovative products and technology to
the spectacle lens market. Shamir Optical's leading lenses are marketed under a
variety of trade names, including Shamir Creation(TM), Shamir Piccolo(TM),
Shamir Office(TM), Shamir Autograph(TM), Shamir Attitude(TM) and Shamir
Smart(TM). Shamir Optical is one of the world's preeminent research and
development teams for progressive lenses, molds, and complementary technologies
and tools. Shamir developed software dedicated to the design of progressive
lenses. This software is based on Shamir Optical's proprietary mathematical
algorithms that optimize designs of progressive lenses for a variety of
activities and environments. Shamir Optical also has created software tools
specifically designed for research and development and production requirements,
including Eye Point Technology software, which simulates human vision.
The world leader in ophthalmic optical products, Essilor International
researches, develops, manufactures and markets around the world a wide range of
lenses to improve and protect eyesight. Its fla gship brands are Varilux(r),
Crizal(r), Essilor(r), Definity(r) and Xperio(TM).
With 34,700 employees and operations in 100 countries, the company reported
consolidated revenue of more than EUR3. 2 billion in 2009.
The Essilor share trades on the NYSE Euronext Paris market and is included in
the CAC 40 index. Codes and symbols: (ISIN: FR0000121667; Reuters: ESSI.PA;
For more information, please visit www.essilor.com.
Shamir Optical investor relations and media contacts
Jeffrey Goldberger, KCSA Worldwide Managing Director
Phone: + 1 212 896 1249 (NY)
FORWARD LOOKING STATEMENTS - DISCLAIMER AND SAFE HARBOR STATEMENTS
Statements concerning the contemplated merger and related transactions, Shamir
Optical's or Essilor's business outlook, plans and objectives, product
introductions and future economic performance and assumptions made or
expectations as to any future events, conditions, performance or other matters,
are "forward-looking statements" as that term is defined under U.S. federal
securities laws. Forward-looking statements are subject to various risks,
uncertainties and other factors that could cause actual results to differ
materially from the results or expectations expressed in those statements. These
risks, uncertainties and factors include, but are not limited to: the inability
to close the transactions referred to in this news release, to obtain required
Israeli court approval, regulatory and shareholder approvals of the merger and
related transactions, and the performance of the obligations pursuant to the
related agreements; conflicts in the region, the effects of competition in the
industry, and changes in Shamir Optical's or Essilor's relationships with
optical laboratories, distributors, research and development partners and other
third parties; the effects of the international expansion of operations of
Shamir Optical and Essilor, and their ability to manage their growth, including
their ability to manage potential future acquisitions; the effect of global
economic conditions in general and conditions in the industry and target markets
in particular; shifts in supply and demand; market acceptance of new products
and continuing products' demand; the impact of competitive products and pricing,
including on products and markets; timely product and technology
development/upgrades and the ability to manage changes in market conditions as
needed; interest rate fluctuations, liquidity and currency risks, and
counterparty and investments risks; other operational, market and legal risks;
and other factors detailed in Shamir Optical's filings with the Securities and
Exchange Commission and in Essilor's annual Registration Document, available on
its website (http://www.Essilor.com) (see, in particular, "Risk Factors" in each
document). Neither Shamir Optical nor Essilor assume any obligation to update
the information in this release.