France's Essilor to buy sunglass maker Costa for $270 million
(Reuters) - Essilor International (ESSI.PA) said it would buy Costa Inc ATX.O, a maker of premium sport sunglasses, in a $270 million deal that would help the French company tap into the growing prescription sun lens market.
Costa shareholders will receive $21.50 per share, representing an 8 percent premium over its Thursday closing price of $19.98. The estimated enterprise value of the deal is about $270 million.
As per the deal, certain Costa shareholders owning about 34 percent stake agreed to vote in favor of the transaction at the forthcoming special meeting called to approve it, Essilor said in a statement.
Based on current estimates, the deal, which will be financed out of Essilor's cash reserves, will add to its earnings in 2015.
The world's largest maker of ophthalmic lenses said Costa's 2013 revenue is expected to be about $100 million.
"The high quality sunglasses and prescription sun lens segment offers high potential given its low penetration rate," Essilor Chief Executive Hubert Sagnières said.
Previously known as A.T. Cross, Costa was founded in 1983 by a group of fishermen who felt the need to produce high performance sunglasses, according to the company website.
(Reporting by Sakthi Prasad in Bangalore; Editing by Supriya Kurane)