Birkenstock Poised for $10 Billion Valuation in U.S. IPO Debut

Birkenstock's move follows the IPO launches of Arm Holdings Plc, Instacart, and Klaviyo in the U.S. over the past month.

Birkenstock Holding Ltd is poised to price its U.S. initial public offering (IPO) at the top of its indicated range, potentially achieving a $10 billion valuation, based on information from individuals close to the proceedings.

The renowned German footwear brand is deliberating to finalize its IPO price between $44 and $49 per share this Tuesday, with shares expected to premiere in New York the following day.

This would allow Birkenstock to raise approximately $1.58 billion if priced at the range’s upper limit.

However, these plans remain subject to change, and Birkenstock has opted not to comment on the situation.

Notably, Birkenstock’s move follows the IPO launches of Arm Holdings Plc, Instacart, and Klaviyo in the U.S. over the past month.

While these companies initiated their IPOs at or above their projected ranges and witnessed initial stock rallies, their subsequent market performance was mixed.

This varying stock trajectory after the debut might be influencing Birkenstock’s decision not to escalate its IPO price range, even with robust initial interest from investors.

When juxtaposed with other major footwear brands, Birkenstock’s sought-after valuation stands out.

The brand’s valuation at the top of its range would be around 27 times its earnings from the past year before adjustments, while renowned brands like Nike Inc trade at around 21 times.

In anticipation of the IPO, Birkenstock recently hosted an investor roadshow.

Significant investment interests have emerged, with Financière Agache expressing intent to purchase $325 million in shares, and both Durable Capital Partners LP and Norges Bank Investment Management showing interest in $300 million worth of shares.

Birkenstock’s origins trace back to 1774 in Germany, with the Birkenstock family overseeing the business for over six generations.

Today, the brand strives to be seen as trendy and has even appeared in popular culture, with Margot Robbie’s Barbie donning pink Birkenstocks in a recent film.

Lastly, L Catterton, which is backed by French magnate Bernard Arnault and luxury conglomerate Louis Vuitton Moet Hennessy, acquired a dominant stake in Birkenstock in 2021.

Post-IPO, L Catterton is set to retain an 82.8% stake in the company.