Essilor International's shareholders voted by a majority of 31 million shares against 9 million in favor of a resolution at the general meeting earlier this month that authorizes an equity increase in case of a hostile bid. With 90.7 percent of the equity now floating freely on the stock exchange, following last year's retreat of Saint-Gobain, the world's largest lens manufacturer has become a potential prey for acquisitions. As of last Feb. 27, French institutional investors held 27.3 percent of the shares, while foreign shareholders owned 47.4 percent. Staff members and others owned about 10 percent of the equity, carrying double voting rights.

At the meeting, Xavier Fontanet, chairman and CEO of the French group, said that all its departments have been asked to raise their operating margins by 0.5 percentage points annually over the next few years. The strongest improvement is still expected from the integration and consolidation of the 75 laboratories bought in the USA since 1996.

Thanks to its joint venture with Nikon and the transfer of Japanese production to Essilor's facilities in Thailand, the Philippines and China, Essilor has achieved an operating margin of more than 10 percent in Japan, where its sales grew by 7 percent last year in a market that dropped by 2-3 percent in value. Working mainly with independent opticians, rather than wholesalers, the group has gained a market share of nearly 20 percent in Japan, where it's about to overtake Seiko as the second-largest player in the country.

Essilor claims world market shares of 20 percent in volume and 25 percent in value in ophthalmic lenses. It feels now ahead of Seiko and Hoya in ultra-high-index lenses, a small market that is growing at a rate of about 20 percent a year, but it admits that it is still behind Hoya in medium-index lenses, a market that is growing half as rapidly. Thanks in part to BBGR's new Evolis line of progressive lenses, which is being introduced in the USA this year under the Ovation brand name, the group's sales in France rose last year by 7.5 percent, indicating a gain in its domestic market share.