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German sandal maker Birkenstock is set to be valued at more than $9 billion in an initial public offering this month, the latest sign of a recovery in the U.S. market for new listings after deals have been scarce since early 2022.
Birkenstock said in an updated prospectus that it would sell shares at $44 to $49 a share, which would raise up to $1.6 billion for the company and its private equity owner L Catterton.
Based on the shares outstanding after the issuance, the initial market value of Birkenstock’s shares will reach $9.2 billion. If calculated on a fully diluted price, the initial market value of Birkenstock’s shares will reach $9.9 billion.
L Catterton, backed by French luxury fashion brand LVMH, is expected to go on sale next week.
About a third of the proceeds from the deal will go to Birkenstock, which said it will use the funds to pay down debt, while the remainder will go to L Catterton.
The company and its advisors have found lead investors for the deal. Financière Agache, the family holding company of LVMH Chief Executive Bernard Arnault, has expressed interest in buying up to $325 million in shares.
Arnold’s son Alexander is expected to join the company’s board after the IPO, documents show.
Norway’s sovereign wealth fund and Durable Capital Partners plan to buy up to an additional $300 million in shares.
The company’s plans to go public were nearly derailed by the U.S. government shutdown, but lawmakers narrowly averted it with a last-minute deal over the weekend.
Birkenstock, which dates back to 1774, first received private equity funding when L Catterton acquired a majority stake in a €4 billion deal in 2021.
In the nine months to the end of June, the company’s revenue was 1.1 billion euros, an annual increase of 21%. However, net profit fell 20% to 103 million euros.
It would be the third-largest U.S. listing so far this year, according to Dealogic.
Following a string of tech company listings in September, bankers had been hoping successful deals for well-known consumer brands such as Birkenstock would further boost the market.
“It’s important because it’s a different industry, so it provides broader data (to encourage other potential IPO candidates),” said one senior IPO banker.
Arm, Instacart and Klaviyo all traded last month priced at or above their target ranges, although the stocks have traded mixed in the weeks since. Overall, companies have raised $17.4 billion in U.S. IPOs so far this year, up more than 140% from the same period last year.
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