In the first half of the 2022/23 financial year, Birkenstock increased its sales by 19 percent to 646 million euros, while the operating result (adjusted EBITDA) increased by 11 percent to 225 million euros.
(Photo: dpa)
Frankfurt, Dusseldorf According to financial circles, the Birkenstock company, known for its health sandals, has started preparations for an IPO in the USA. Owner L Catterton, a Franco-American private equity firm, has hired investment banks to organize the deal, according to people familiar with the transaction. These include JP Morgan and Goldman Sachs. The company could be valued at around six billion dollars.
If the capital markets allow it, the stock market debut could take place after the summer break or in the coming year. L Catterton, Birkenstock and the banks declined to comment or were initially unavailable.
L Catterton was formed in 2016 when US investment house Catterton merged with the private equity business of LVMH and its billionaire founder Bernard Arnault. In 2021, L Catterton took a majority stake in Birkenstock, valuing the company at $4.9 billion. The brothers Christian and Alex Birkenstock remained involved in the company.
After L Catterton got on board, Birkenstock launched a sales offensive – primarily in the direction of the USA and Asia. In 2022, Birkenstock increased its sales to 1.24 billion euros, while the operating result (adjusted EBITDA) increased to 435 million euros.
In February, Birkenstock appointed Erik Massmann as the new chief financial officer, who now has the task of promoting Birkenstock to potential investors as a good investment.
The fact that a number of other fast-growing, disruptive consumer brands are listed there and that Birkenstock can hope for a higher valuation speaks in favor of the USA as a stock exchange location. In addition, owner L Catterton would prefer portfolio companies to be listed in its home market, according to people familiar with the transaction.
Birkenstock: Investments of 100 million euros
When L Catterton joined the almost 250-year-old company from Linz am Rhein, there was talk of planned investments of 100 million euros, which should flow into the modernization of the Birkenstock factory in Görlitz in East Saxony, where the cork Latex sandals are made.
Last summer, the company announced a new plant in Pasewalk, in which a total of 120 million euros are to be invested – the largest single investment in the company’s history. Production is scheduled to start in the third quarter. In the medium term, 1,000 people are expected to work there. Birkenstock currently employs 5,500 people worldwide.
Investor L Catterton is heavily invested in consumer goods, managing $30 billion in assets. The portfolio of current investments includes the fashion brands Etro and Ganni from Italy and Denmark and the Australian outdoor brand 2XU. In addition, L Catterton holds smaller shares in start-ups such as the German Amazon resellers Razor and SellerX, the tourism portal Getyourguide, the meat substitute manufacturer Planted and the used goods exchange Cazoo.
In the case of takeovers, the investor likes to keep the previous owners in the house. Two years ago, LVMH boss Arnault spoke of an “iconic brand” that the new investors wanted to help “fully exploit its great growth potential”.
Celebrities like Kristin Steward and Kendall Jenner wear Birkenstocks
This strategy seems to be working. Especially in the USA, the traditional brand has recently experienced a real upswing. More and more influencers and celebrities like Kristin Steward and Kendall Jenner are wearing Birkenstocks and have triggered a real hype.
Even inconspicuous traditional models such as the Boston clogs, which now cost 150 euros new, have become bestsellers and are largely sold out. The model has been available in an unchanged design since 1979. Boston clogs have been trading for around $350 on resale sites at times.
The company also managed to successfully expand its product range. It first introduced ballerinas under the Birkenstock brand and, this year, sneakers as well. The anatomically shaped cork footbed is characteristic in each case.
The Birkenstock brand has existed since 1774. The company has 16 locations, four of which are for production, all in Germany. In addition to sandals and shoes, Birkenstock has also been producing beds and cosmetic products for four years and has been calling itself a “global lifestyle brand” ever since.
In June of this year, the company celebrated the 150th anniversary of the birth of Konrad Birkenstock, who at the beginning of the 20th century had developed the anatomically shaped footbed, which he had patented back then as “health footwear”.
The company was owned by the sixth generation of the brothers Alexander and Christian Birkenstock before the holding company L Catterton and the family holding company of LVMH CEO Bernard Arnault, Financière Agache, took over the majority. The Bloomberg news agency had previously reported on the IPO preparations.
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