RANCHO CORDOVA, Calif.--On Friday, Vision Service Plan (VSP) took over ownership of Marchon Eyewear, after acquiring the eyewear manufacturer/distributor the day before for $735 million, funded by a combination of cash and debt. The acquisition creates a new combined entity with projected revenues of $3.3 billion this year; puts VSP’s Altair Eyewear operation under the umbrella of Marchon, now a wholly owned subsidiary of VSP; and melds VSP’s Eyefinity Internet portal with Marchon’s OfficeMate Software Solutions practice-management operation into a new “eyecare business solutions organization.”

As part of the transaction, VSP will also acquire Marchon’s 50-percent ownership of Eye Designs, which designs custom interiors and merchandising systems for the optical industry.

Marchon’s Al Berg and VSP’s Rob Lynch

“Bringing together the world-class products and expertise of Marchon with Altair, VSP’s for-profit eyewear company, creates an integrated organization that benefits eyecare professionals and their customers,” said Rob Lynch, VSP’s president and chief executive officer, in announcing the deal. “Together we will deliver value by focusing on quality and operational excellence.”

Lynch added, “The synergy between OfficeMate Software Solutions and Eyefinity was an important consideration in the acquisition, and helps fulfill our vision of a fully integrated eyecare delivery platform that benefits eyecare professionals, patients, clients and industry partners.”

Al Berg, Marchon’s president and CEO, and Larry Roth, executive vice president of Marchon, along with the Marchon global team, will continue in their current roles, with Berg reporting to Lynch.

“Given the rapidly changing eyecare marketplace, this is a win for Marchon, VSP and the optical industry,” Berg commented. “This merger will help us continue our vision for growth by expanding our products, services and programs to our global customer base.”

Marchon will maintain its Melville, N.Y., headquarters as an independent entity within the VSP organization, an announcement said. Altair, which becomes a division of Marchon, remains in its headquarters here; Steve Wright, president of Altair, now reports to Berg.

Heading up the newly merged Eyefinity/OfficeMate operation--which in the interim will be a co-branded entity, a VSP spokesman told VMail--as president will be Jim McGrann, formerly senior vice president and chief information officer of Marchon. Reporting to McGrann are Steve Baker, chief technology officer of the new entity, who continues to lead Eyefinity; and Ed Buffington, chief operating officer, who still leads Office Mate.

Jim McGrann

Said McGrann, “Our existing customers and all eyecare professionals can expect to see a broad range of new technologies, enhanced support services and expanded products. We will squarely focus on developing and delivering the business solutions that help eyecare professionals easily manage the growing pace and complexities of today’s eyecare business environment.”

Through its network of more than 25,000 private-practice eyecare practitioners, VSP delivers eyecare benefits to 55 million members in the U.S. and Canada. The company’s total revenues in 2007 reached $2.6 billion; VSP is projecting revenues of $2.8 billion for this year.

Marchon--which sells its products around the world and has international offices in Amsterdam, Hong Kong and Tokyo in addition to its presence in the U.S.--had total sales in 2007 of more than $525 million, the announcement said. The company’s licensed eyewear and sunwear brands include Calvin Klein, Coach, Emilio Pucci, Fendi, Jil Sander, Karl Lagerfeld, Michael Kors, Nautica, Nike, Oscar de la Renta, Sean John and X Games. Additionally, Marchon manufactures its own collections of eyewear, including lines such as Airlock and Flexon.

The VSP spokesman said Marchon’s licensors have approved the transaction; the acquisition has also received required regulatory approval from the California Department of Managed Care and the Connecticut Department of Insurance. Several months ago, VSP filed with those bodies for approval of a deal described in the filings as the $700-million acquisition of “all of the outstanding stock of a vision care company.” In those filings, VSP said it had entered into a definite agreement on April 30 to acquire the then-unnamed company.

For exclusive details on both VSP’s and Marchon’s operations, visit www.visionmonday.com. Watch for further updates on this breaking story in VMail and on the Web site.