[1/2]A Birkenstock shoe store is pictured on January 21, 2021 in Berlin, Germany. Portal/Fabrizio Bensch/File Photo acquire license rights
NEW YORK, Oct 8 (Portal) – Birkenstock Holding (BIRK.N) has received enough commitments from investors to keep the price of its U.S. initial public offering at the top of the specified range and achieve a valuation of, according to people familiar with the matter To reach $10 billion with the matter.
The German premium footwear company will make a final decision on Tuesday on pricing its initial public offering at the high end of its range of $44 to $49 per share, before its shares debut in New York on Wednesday, the sources said.
Birkenstock would end up raising a total of $1.58 billion.
The sources noted that discussions were fluid and requested anonymity because the matter is confidential. Birkenstock declined to comment.
Birkenstock is the fourth major company to launch an initial public offering in the U.S. in the past four weeks, following those of chipmaker Arm Holdings, grocery delivery app Instacart (CART.O) and marketing automation platform Klaviyo (KVYO.N).
They priced their IPOs at the high end or above the specified range and saw their shares rise on debut, only to give back most of the gains in the following days. While Arm and Klaviyo shares are still trading above their IPO price, Instacart stock is now worth less than its IPO value.
This explains why Birkenstock is reluctant to raise its IPO price range despite strong initial investor demand.
It’s already aiming for a valuation that’s higher than some larger shoe brands. It would be worth about 27 times trailing 12-month earnings before interest, taxes, depreciation and amortization at the top of its range, while Nike (NKE.N) trades at 21 times.
In order to leave less to chance, Birkenstock started the roadshow for its IPO last week, which was attended by some investors. Financiere Agache has expressed interest in buying $325 million worth of shares, while Durable Capital Partners and Norges Bank Investment Management have expressed interest in buying $300 million worth of shares, Birkenstock said in a filing.
According to the sources, growth capital investor Baron Funds placed an order for shares worth $500 million after the roadshow began. The sources said there would be about $1.13 billion worth of shares between the lead investors and Baron.
Birkenstock was founded in 1774 in the German village of Langen-Bergheim by Johannes Birkenstock and his younger brother Johann Adam Birkenstock, both of whom were shoemakers. After its founding, the Birkenstock family ran the company for six generations.
The brand has tried to position itself as a fashionable garment worn by models and celebrities. Barbie, played by Margot Robbie, wore a pink pair of Birkenstocks in the final scene of the film, which was released this summer.
L Catterton, the private equity group backed by French billionaire Bernard Arnault and luxury goods empire Louis Vuitton Moet Hennessy (LVMH.PA), acquired a majority stake in Birkenstock in 2021.
Following the IPO, L Catterton will hold an 82.8% stake in Birkenstock and control the majority of the total voting power of its outstanding shares.
Reporting by Anirban Sen in New York. Editing by Chris Reese and Lisa Shumaker
Our standards: The Trust Principles.
Acquire license rights, opens new tab