Birkenstock, the famous German shoemaker known for its cork-soled sandals, has successfully raised approximately $1.48 billion in its initial public offering. The company set the price of its shares within the range it had previously announced, resulting in a valuation exceeding $9 billion. Birkenstock’s popularity soared after it was acquired by private equity firm L Catterton and Bernard Arnault’s family investment company, propelling the brand into the mainstream. Collaborations with renowned shoe designers like Manolo Blahnik and Valentino Garavani have contributed to the company’s impressive sales growth, reaching €1.24 billion in 2022 compared to €292 million in 2014.
However, analysts remain cautious about Birkenstock’s prospects in a challenging market, as the company aims to expand its presence in Asia and the United States. A cost-of-living crisis has prompted consumers to limit their spending on fashion items. Additionally, recent shoe companies that went public, including Allbirds, Dr. Martens, and On Running, have seen their market value decline since their IPOs in 2021. Furthermore, David Trainer, the CEO of investment research firm New Constructs, points out that other recent IPOs such as Arm Holdings and Instacart have experienced significant stock price drops shortly after going public.
Despite these challenges, Birkenstock’s shares are set to trade on the New York Stock Exchange under the ticker symbol BIRK, with trading expected to commence on Wednesday. The company priced its shares at $46 each, slightly within the previously estimated range of $44 to $49. It sold over 32 million shares in the offering, and the opening trading price may differ from the IPO price.
