Roger Hardy, founder and CEO of Coastal Contacts, has struck a deal to sell the company to Essilor International.Lyle Stafford/The Globe and Mail
Roger Hardy, founder of Vancouver-based Coastal Contacts Inc., says he wasn't looking for a buyer for his maker and online retailer of eye wear products.
But when when the world's largest lens manufacturer, France-based Essilor International SA, approached the company in the fall, Mr. Hardy began to see value in the partnership. Essilor announced on Wednesday it would buy Coastal for $435-million.
"We weren't pursuing a deal. They came to us," said Roger Hardy, who is also the company's chief executive officer. "I think they were thinking about technology and a platform to serve their customers in a better way, and also seeing that the Internet is a part of eye care in the future."
Mr. Hardy says that eye wear is a $20-billion business in North America alone, and he expects 20 per cent of that market will be online in the next five years.
Coastal, which operates under the Clearly Contacts brand name in Canada, is as much of an e-commerce engine as an contacts and glasses provider. Mr. Hardy recently invested in a small online retailer, ShoeMe.ca, which linked to the ClearlyContacts.ca website, for example.
But rather than selling to a tech company, Coastal will likely target the eye care professionals that Essilor develops equipment, instruments and services for.
"Essilor's business is more about serving eye doctors and we're more direct to customer. I think [the deal] is going to be about leveraging our technology platform to serve eye doctors and customers in a more convenient way," Mr. Hardy said.
"Part of why our business has been successful is it's just so convenient, and I think adding this kind of option to an eye doctor's portfolio would elevate the experience for customers," he said.
Essilor does have a few online distributor engines of its own, through FramesDirect and EyeBuyDirect and MyOnlineOptical. But the Coastal deal adds five million new customers. Essilor has identified online sales as a strategic growth area along with boosting its exposure to developing countries, targeting sunglasses and popular consumer brands.
There are no immediate changes planned to Coastal facilities or production in Vancouver, Sweden, Australia or the U.S.
Mr. Hardy will stay with the company through the transition to the owners.
Coastal hired Guggenheim Securities LLC as lead financial adviser and Roth Capital Partners as co-financial adviser on the deal. McCarthy Tétrault LLP acted as legal adviser.