German shoemaker Birkenstock Holding Plc
IPO Details: Birkenstock and private-equity firm L Catterton announced plans to sell approximately 32.3 million shares in the offering somewhere in the range of $44 to $49 per share last week. Birkenstock has now landed near the middle of the provided range, targeting a valuation of approximately $8.6 billion.
Birkenstock has said it plans to use proceeds from the IPO to repay borrowings and create financial flexibility, as well as for general corporate purposes.
It's the first high-profile name to test the public markets since Arm Holdings Plc
The trio of popular IPOs from September all priced at the high end of their targeted ranges. Instacart is currently trading about 10% lower than its IPO price, while Arm and Klaviyo are trading slightly higher. Birkenstock looks to test the IPO waters and set the stage for the IPO market in the final quarter of the year.
About Birkenstock: Birkenstock Holding is the parent company of the Birkenstock shoe brand, famous for its cork-based sandals the company calls "footbeds." Birkenstock aims to empower all people to "walk as intended by nature."
The shoemaker assembles over 95% of its products in Germany and sources materials that originate mainly from Europe.
According to the company's S1 filing, Birkenstock uses a multi-channel "engineered distribution" model, which balances demand for its products with a constrained supply capacity to intentionally create scarcity in the market.
As a result of the company's distribution approach, it has been able to drive strong revenue growth and operating margins. In 2022, Birkenstock sold approximately 30 million units, generating revenue of 1.24 billion euros ($1.32 billion) and net profit of 187 million euros on gross margins of 60%.
Birkenstock has been in the shoe business since 1774 and was introduced to the U.S. market in 1966. Oliver Reichert was appointed CEO in 2013, marking the first time someone from outside the Birkenstock family took the reins of the company.
Financial performance is largely dependent on how people perceive the Birkenstock brand. Risks include negative consumer perception, supply chain problems and quality control, and increasing competition.
The Brikenstock "footbed" is proprietary, but several other shoemakers have created similar products. Competitors include Nike Inc
Birkenstock is set to begin trading under the ticker symbol "BIRK" on Wednesday afternoon.
