LINCOLN – Costa Inc., formerly A.T. Cross Co., has reached a deal to be acquired by Essilor International SA, the world’s largest manufacturer of corrective lenses, the companies announced Friday.
Essilor, which is based in Charenton-le-Pont, France, will acquire all outstanding Costa Inc. shares for $21.50 per share, an enterprise value of approximately $270 million. Costa shareholders owning roughly 34 percent of the outstanding shares have agreed to vote in favor of the transaction at a forthcoming special meeting.
Kevin F. Mahoney, senior vice president of finance and chief financial officer for Costa Inc., said the company will continue to operate independently as a wholly-owned subsidiary of one of Essilor’s “legal entities,” but declined to comment more specifically.
In 2009, Essilor acquired FGX International Holdings Ltd. in Smithfield for about $565 million. Mahoney said he did not have any information about how Essilor’s acquisition of Costa might be affected by the proximity of another Essilor-owned eyeglass manufacturer.
Costa’s primary operations centers in Florida and Colorado will continue to operate as they have, he said, but Mahoney declined to comment about whether the company’s corporate headquarters in Lincoln will be relocated.
The deal is expected to close in 2014 subject to regulatory approval and other conditions.
“When viewed in comparison with comparable transactions, we believe that this transaction represents significant value to our shareholders,” said David G. Whalen, CEO of Costa Inc. “As a member of the Essilor family, we will have access to a deep pool of world-class resources, including technology and distribution that will drive our continued growth both in the United States and the global marketplace.”
The acquisition agreement provides that Costa may consider superior proposals from other interested parties and will pay a termination fee of approximately $8.9 million upon the acceptance of such a proposal.
The transaction is not subject to any financing contingency and will be financed out of Essilor’s cash reserves, Costa said. D.A. Davidson & Co. will serve as Costa’s financial adviser, and Weil, Gotshal & Manges LLP will act as the company’s legal counsel through the acquisition.
Costa Inc., vendor of Costa and Native Eyewear brand sport sunglasses, officially adopted the Costa name in September after selling its Cross Accessory Division and rights to the A.T. Cross name – historically associated with the company’s signature pens and related products – to an affiliate of private equity firm Clarion Capital Partners in July.
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