Rancho Cordova-based VSP Vision Care bought eyewear manufacturer Marchon Eyewear Inc. on Monday in a deal that combines the nation's largest eye care benefits provider with one of the world's largest manufacturers of designer eyewear.
The cash-and-debt deal worth $735 million creates a company with an estimated $3.3 billion in 2008 revenue that is believed to be the largest opthalmic services company based in the United States, said VSP President and Chief Executive Officer Rob Lynch.
One of every six Americans, about 55 million people, receives eye care insurance from the benefits giant. VSP Vision Care posted $2.6 billion in revenue in 2007.
Melville, N.Y.-based Marchon makes and sells eyewear and sunwear for labels including Calvin Klein, Coach, Karl Lagerfeld and Sean John, posting more than $525 million in sales in 2007.
VSP manufactures eyewear for Tommy Bahama, Joseph Abboud and Revlon through its Altair Eyewear company, also based in Rancho Cordova.
Lynch, speaking from Melville, said the deal will give VSP's network of doctors better access to products and will allow the company to extend its benefit services outside North America.
It also comes as consolidation has become more common in the industry, spotlighted by Italian-based Luxottica's $2.1 billion purchase of Oakley Inc. in 2007.
"Given the rapidly changing eye care marketplace, this is a win for Marchon, VSP and the optical industry," Marchon President and Chief Executive Officer Al Berg, said in a statement.
The deal extends VSP's reach. Marchon, with its regional offices in Amsterdam, Netherlands, Hong Kong and Tokyo, distributes products to more than 100,000 locations in more than 100 countries.
Marchon's management will stay in place and its offices will remain in New York. Altair becomes a division of Marchon and will remain in Rancho Cordova, officials said.
Call The Bee's Darrell Smith, (916) 321-1040.
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