Birkenstock’s IPO Valued at $10 Billion as Investors Show Strong Interest
German premium footwear company Birkenstock Holding has garnered enough investor commitments to price its U.S. initial public offering (IPO) at the top of its indicated range, reaching a valuation of $10 billion. The final decision on pricing the IPO at the upper end of the $44-to-$49-per-share range is expected to be made on Tuesday, with the shares set to debut in New York on Wednesday.
Birkenstock’s IPO follows a trend of successful public offerings in recent weeks, including those of Arm Holdings, Instacart, and Klaviyo. Despite some of these companies experiencing a decline in share prices after their initial surge, Birkenstock remains confident in its IPO pricing strategy. The company aims to achieve a valuation that surpasses other prominent shoe brands, trading at approximately 27 times trailing 12-month earnings before interest, taxes, depreciation, and amortization, compared to Nike’s 21 times.
To ensure a successful IPO, Birkenstock initiated a roadshow last week, attracting interest from several investors. Financiere Agache, Durable Capital Partners, Norges Bank Investment Management, and Baron Funds have all expressed interest in purchasing significant amounts of shares, totaling around $1.13 billion.
Founded in 1774 by Johannes Birkenstock and Johann Adam Birkenstock, Birkenstock has been a family-run business for six generations. The brand has recently focused on positioning itself as a fashionable item worn by models and celebrities, with Margot Robbie’s Barbie character sporting a pink pair of Birkenstocks in a recent movie.
L Catterton, a private equity group backed by French billionaire Bernard Arnault and luxury goods empire Louis Vuitton Moet Hennessy, acquired a majority stake in Birkenstock earlier this year. Following the IPO, L Catterton will hold an 82.8% stake in Birkenstock and control a majority of the combined voting power of its outstanding shares.
With strong investor interest and a valuation of $10 billion, Birkenstock’s IPO is poised to make a significant impact in the footwear industry.