Luxottica Group SpA, the world’s largest eyewear maker, said Andrea Guerra stepped down as chief executive officer after a decade at the helm following differences with founder Leonardo Del Vecchio.
Guerra, who joined in 2004 from Indesit Co., and Del Vecchio, who started the business in 1961 and still owns a 65 percent stake, didn’t share the same goals, the billionaire founder said today at a press briefing in Milan. Del Vecchio will become part of a three-strong leadership team that will include finance chief Enrico Cavatorta.
“I have respect for Guerra, but unfortunately our views of the company’s future diverged,” Del Vecchio told reporters. The departure was “without arguments, it was consensual.”
Guerra’s tenure had been subject to speculation within the company since July, trade union representatives told Il Sole 24 Ore last month. Guerra, 49, and Del Vecchio, 79, have been debating strategic direction and managerial structure for some time, Luxottica said Aug. 21, responding to reports of a spat. Luxottica stock has almost tripled since the CEO joined in 2004.
Guerra will receive a redundancy payment of 10 million euros ($13 million), the maker of Ray-Ban eyeglasses said. He will be replaced by Cavatorta and a co-CEO to be appointed from outside Luxottica at a later date.
Cavatorta, 53, will oversee corporate functions, while his counterpart will focus on markets, the company said. Both will be supported by an executive committee led by Del Vecchio.
“Instead of just having one head of the company, we will have three,” Del Vecchio said at the briefing, adding that he is targeting annual revenue growth of 7 percent. “We did 10 years with Guerra. We will do another 10 with the triumvirate.”
The adoption of a shared leadership structure “will see the group retain its strong focus on sales and profitability, and ensure it is ready to seize opportunities and face the challenges of the market,” Del Vecchio said in the statement.
Guerra, who was Luxottica’s first CEO from outside the Del Vecchio family, more than doubled the company’s revenue to 7.3 billion euros. He expanded the business globally and presided over a string of acquisitions, including those of the Oakley brand and Brazilian eyewear maker Grupo Tecnol Ltda.
“Nothing lasts forever,” Luca Solca, an analyst at Exane BNP Paribas, said in an interview with Bloomberg Television. After Guerra, “it’s going to be very important for Luxottica to show the market they have the commercial ability and skills on board to drive the business forward.”
Guerra leaves Luxottica with a roster of owned and licensed brands that include Prada and Chanel, selling eyewear in more than 7,000 of its own stores and via wholesale partners in more than 130 countries. The company’s manufacturing plants in Italy, China, Brazil and the U.S. made more than 77 million frames last year, according to its website.
Cavatorta joined Luxottica in 1999 and became a director of the company in 2003. He previously worked for Piaggio & C SpA, McKinsey & Co. Inc. and Procter & Gamble Co.
While acknowledging the leadership qualities of Del Vecchio and Cavatorta, Citigroup Inc. analyst Mauro Baragiola said an enlarged leadership team could be problematic.
“We doubt that three chiefs will be better than one as eventually someone has to make the decisions,” Baragiola said.
Luxottica shares rose 0.5 percent to 40.84 euros at the close of trading in Milan today, extending their gain this year to 4.7 percent.