Essilor is pursuing its external growth strategy in Italy with the acquisition of Galileo, an important player in the Italian market. The company sells only in Italy a large variety of prescription and stock lenses under its own brand, which is widely recognized among Italian consumers. Galileo operates a prescription laboratory in Milan and generates €13 million in annual revenues, which grew by 10 percent in 2007.
Galileo has 10 distribution centers throughout the Italian peninsula that allow it to deliver standard lenses to opticians in one day. Delivery schedules grow to 48 hours for more sophisticated lenses. While the Essilor group already enjoys a high market share in Italy, the fragmentation of the Italian market and the existence of many small in-store and independent laboratories that can deliver lenses very quickly has hurt its development in the country.
Formerly owned by Signet Armorlite, Galileo's Venice-based business was acquired in 2000 in the course of bankruptcy proceedings by Leo Polzotto, chairman of an Italian producer of mineral lenses, Ital Lenti. The combination allowed him to offer an alternative range of lenses in polycarbonate. Next week's session of MIDO will be the last one where Galileo and Ital Lenti have a joint stand.
Essilor has also announced three other acquisitions in the USA. Its subsidiary Essilor of America has purchased a majority stake in Empire Optical of California in North Hollywood. A distributor of Varilux lenses, the company has 168 employees and $23 million in annual revenues. The company has also acquired a controlling stake in two other prescription laboratories: Advance Optical Sales Co. in Rochester, New York, with revenues of $6.1 million, and Future Optics in Jackson, Tennessee, with revenues of $3.3 million.
Separately, Nikon Optical USA has acquired a minority stake in Encore Optics, an independently owned prescription laboratory in South Windsor, Connecticut. Nikon Optical is a recently established subsidiary of the Nikon-Essilor joint venture in Japan that markets its products in the USA, independently from Essilor of America. Founded by Paul and Ivy Zito in 2003, Encore Optics is described as a full-service wholesale laboratory providing support and products to eye care professionals in New England and the Hudson Valley.
The deal with Nikon Optical USA gives Encore exclusive rights to produce and distribute the full range of Nikon's advanced optical products, including advanced aspheric single-vision lenses and digitally surfaced progressive lenses, to the Northeastern U.S. market. Encore will also work with the Japanese lens maker on introducing Nikon's lens coatings. The two companies have set up a Nikon coating facility in Encore Optics' laboratory in Connecticut.
Aside from Novisia in France, Nikon Optical USA is Nikon's fourth ophthalmic subsidiary after the establishment of similar operations in Canada, the U.K. and China. The Japanese joint venture with Essilor has developed new technologies for ophthalmic lenses, particularly in the field of advanced aspheric lens designs, high-index plastic lenses and super scratch-resistant, anti-reflective coatings. Its American subsidiary distributes premium ophthalmic lenses, materials and coatings including Nikon W and Presio i progressive lenses, a full-range of stock Nikon anti-reflective coated aspheric single-vision lenses, standard 1.50 index up to 1.74 ultra-high index material and now Nikon anti-reflective coatings HCC, ECC and SeeCoat.