Delfin, Basilico proposes the sale of shareholdings to settle outgoing shareholders
The proposal: financial holdings are valued at 100 per cent of market value, whilst a 25 per cent discount is applied to EssilorLuxottica. Sources close to LMDV respond: “No heir would ever sell the family business on those terms.”
by Enrico Miele
Ahead of Delfin’s general meeting on 30 June, Rocco Basilico puts pen to paper and sends a scathing letter to the board and shareholders of the Luxembourg-based holding company. ‘Twelve months on,’ the letter begins, ‘we are once again experiencing a climate of intense tension, perhaps even more so than last year.’ His assessment is clear-cut: “Relations between some of us — and, in my case, unfortunately, even within my own family — have deteriorated further; similarly, the relationship of trust between the shareholders and the board of directors has been undermined. Today we find ourselves once again in a deadlock that risks jeopardising Delfin’s future.”
The proposal: a share buyback funded by the sale of financial holdings
To break the deadlock, according to Basilico, “Delfin could buy back the shares held by shareholders who are no longer interested in remaining in the company, financing this through the sale of its financial holdings”. That is to say, amongst others, the 10 per cent stake in Generali, the 2.7 per cent stake in Unicredit and the 17.5 per cent stake in Banca Mps.
But this is not the only solution. Alternatively, it proposes an ‘intermediate’ and ‘balanced solution, capable of safeguarding the group’s strategic asset whilst, at the same time, meeting the various needs of the shareholders’, namely ‘to retain the entire stake in EssilorLuxottica in full and to provide for the distribution to shareholders of some or all of the financial holdings’.
Essilux valued at a 25 per cent discount. Lmdv: ‘Never’
In any case, to calculate how much Delfin is ‘worth’ – and thus compensate those wishing to exit – Rocco Basilico proposes to value the financial holdings at 100 per cent of their market value, as they are ‘easily realisable’. Meanwhile, EssilorLuxottica would be subject to a 25 per cent discount compared to its stock market price, a percentage he describes as “at the upper end of the discounts generally applied to holding companies”.
A sharp retort came almost immediately from sources close to Leonardo Maria del Vecchio, who emphasised that, from his point of view, ‘no heir would ever sell the family business at a discount’.
