Czech defence industry billionaire Michal Strnad has submitted a €30 billion ($33.5 billion) bid to acquire Delfin, the family holding company that is the largest shareholder in EssilorLuxottica, the eyewear giant behind Ray-Ban.

The unsolicited all-cash offer, detailed in an October 20 letter seen by Bloomberg, values Delfin at a 30% discount to its net asset value (NAV). Although Strnad is seeking to acquire the entire company, he has indicated that he would also accept a controlling stake of at least 62.5%, allowing some of the eight heirs to retain their holdings.

The proposal comes amid a prolonged family dispute following the death of Leonardo Del Vecchio, the founder of Luxottica, in 2022.

Acquiring Delfin would give Strnad control over an investment portfolio with a market value exceeding €40 billion, including a stake of almost one-third in EssilorLuxottica, as well as substantial holdings in Italian insurer Assicurazioni Generali and banking groups UniCredit and Banca Monte dei Paschi di Siena.

Family tensions complicate the proposed takeover

Delfin’s ownership is divided equally among eight heirs, each holding a 12.5% stake. The family has been embroiled in legal disputes involving both the shareholders and the management appointed by Del Vecchio.

Strict ownership provisions established by the late billionaire have complicated efforts to resolve the disagreements. Some family members have sought to cash out their stakes, while others have attempted to consolidate their holdings by purchasing shares from relatives.

One of the most outspoken opponents of the Czech billionaire’s proposal is Leonardo Maria Del Vecchio, 31, whose recent €3.5 billion offer to acquire the stake held by his half-brother Rocco Basilico was rejected.

“My father’s life’s work must remain an asset for Italy,” Leonardo Maria told Bloomberg, stressing his determination to preserve Italian ownership of Delfin and protect the stability of the country’s banking system.

For Strnad’s proposal to succeed, the company’s ownership restrictions would need to be amended with the unanimous approval of all eight shareholders.

That requirement presents a major obstacle, particularly given the discount attached to the offer and concerns about transferring control of a strategically important Italian investment group to a foreign investor.

Shares in EssilorLuxottica showed only marginal movements in Paris following news of the proposal, suggesting limited market expectations of an imminent deal.

Czech Republic’s richest man seeks to diversify

Strnad, who inherited control of the defence conglomerate CSG from his father in 2018, is currently the wealthiest person in the Czech Republic, with an estimated fortune of $18 billion, according to the Bloomberg Billionaires Index.

Earlier this year, CSG completed what was described as the largest initial public offering ever undertaken by a pure-play defence manufacturer.

The transaction generated €2.55 billion for Strnad, providing additional resources for his family office to expand investments beyond the defence sector.

In his letter to Delfin chief executive Romolo Bardin, Strnad stated that his offer was fully financed and reflected his strategy of investing in market-leading businesses with resilient cash flows.

He also argued that his proposal could complement Delfin management’s preparations to repurchase up to 25% of the company’s shares from dissatisfied family members, potentially providing a broader solution to the ongoing ownership disputes.

Growing investments in Italy

Italy is already an important market for Strnad’s business interests.

His CSG group controls Italian ammunition manufacturer Fiocchi Munizioni, while the billionaire has also recently acquired a personal 14% stake in tyre manufacturer Pirelli.

These investments underline his ambition to establish a significant presence in Italy, the eurozone’s second-largest manufacturing economy.

The proposed Delfin acquisition, however, would represent a much larger step, potentially giving the Czech entrepreneur influence over some of Italy’s most prominent financial institutions and one of Europe’s largest luxury eyewear companies.

Whether the bid advances will largely depend on the willingness of the Del Vecchio heirs to overcome their differences and agree to changes in the holding company’s ownership structure.