(Oct 30): Czech arms billionaire Michal Strnad has made a €30 billion (RM135.82 billion) offer to buy the family holding company behind eyewear firm EssilorLuxottica SA, in a bold attempt to muscle into the heart of Italy’s business and finance establishment.

 Strnad’s proposal values Delfin Sarl at a 30% discount to its net asset value, according to the letter dated Oct 20 and seen by Bloomberg. While the cash offer is for the entire company, Strnad said he would accept a controlling stake of at least 62.5% if some of Delfin’s eight owners wanted to maintain ownership. 

The unsolicited, longshot bid aims to exploit an Italian family drama that’s been simmering since the death of EssilorLuxottica founder Leonardo Del Vecchio in 2022. Since then, his eight equal heirs have been bickering in court and, increasingly, with the managers that were hand-picked to oversee the family fortune. Restrictions in Del Vecchio’s will have made it more difficult for the family members to resolve their differences. 

Owning Delfin would thrust Strnad, 34, into the driver’s seat at some of Italy’s most important assets. Its holdings in public companies have a market value of more than €40 billion, including a nearly one-third stake in the Ray-Ban maker, insurer Assicurazioni Generali SpA, and banks UniCredit SpA and Banca Monte dei Paschi di Siena SpA.

At least one of the family members, who each hold 12.5% of Delfin, has said he won’t go along with Strnad’s proposal. 

“My father’s life work must remain an asset for Italy,” Leonardo Maria Del Vecchio said in a statement. 

Representatives for Delfin declined to comment after the proposal was reported late on Thursday. Strnad didn’t respond to a request for comment. 

The offer was sent to Delfin chief executive officer Romolo Bardin, according to Italian newspaper Domani, which first reported on the bid. It is valid for 30 days, and would require all eight shareholders in Delfin to approve changes to ownership restrictions — a significant hurdle given the discount and the swift response from Leonardo Maria.

Leonardo Maria confirmed to Bloomberg he was aware of the offer, and said he would continue to “protect and safeguard what my father built,” ensuring that ownership of Delfin remains Italian. He pointed to the need to keep EssilorLuxottica attached to its roots, and also to maintain stability within Italy’s banking system. 

Shares of EssilorLuxottica were little changed in Paris on Friday. 

The offer follows a period of escalating tensions between EssilorLuxottica founder Leonardo Del Vecchio heirs. Some family members have sought to sell their shares, while Leonardo Maria has attempted unsuccessfully to buy out other siblings, and publicly criticised the stewardship of Delfin and EssilorLuxottica. 

The 31-year-old heir’s recent offer to purchase half-brother Rocco Basilico’s stake for €3.5 billion was rejected, Bloomberg and others reported on Thursday. Earlier this year, he sought to buy out two other siblings, leading to a falling out with Francesco Milleri, Delfin’s chairman and EssilorLuxottica’s chairman and CEO, over the failed effort.

Strnad said in his letter that he’s aware of news reports that Delfin’s management is preparing financing to buy back up to 25% of Delfin from two family members. He said his plan isn’t incompatible and could be combined with that effort. 

He said he’s confident his proposal “may create the favourable conditions for the parties to bring an end to the existing disputes and reach an overall settlement.”

In his letter, Strnad said Delfin “perfectly fits with my investment approach and strategy”. He also said he had secured funding for the offer, which would not require additional financing.

“I am looking for long-term investment opportunities in companies operating or investing in businesses positioned at the top of their value chain and capable of generating recurring and resilient cash flows,” the letter said.

Strnad, who inherited his CSG NV defense group after his father transferred ownership in 2018, is the richest Czech with a net worth estimated at US$18 billion (RM73.07 billion), according to the Bloomberg Billionaires Index. 

Early this year, CSG completed the biggest ever initial public offering for a pure defence company. At that time, the tycoon said that he planned to use his €2.55 billion in proceeds for his family office, which would invest in a portfolio of non-defence related companies.

He has already built a business presence in Italy. CSG owns Italian ammunition maker Fiocchi Munizioni, while Strnad expanded his personal investments this year by acquiring a 14% stake in tiremaker Pirelli & C SpA. He has said it is a long-term investment and doesn’t represent a maximum holding.

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