Birkenstock Holding Plc, the renowned German shoemaker, had a disappointing start in the stock market as its shares opened 11% below the price set in its initial public offering (IPO) of $1.48 billion. This lackluster debut could potentially have a negative impact on the recent resurgence of US listings. The data from Bloomberg indicates that Birkenstock’s IPO marks the worst opening for a listing of $1 billion or more in New York over the past two years. In fact, out of more than 300 US IPOs of similar size in the last century, only nine have fared worse. The most recent example is AppLovin Corp., which debuted in April 2021 at 12.5% below its IPO price.

On Wednesday, Birkenstock’s shares began trading at $41 per share, compared to the IPO price of $46. The pricing of the IPO itself was set below the midpoint range of $44 to $49. In the IPO, the company and its private equity owner, L Catterton, sold approximately 32 million shares. As of 1:35 p.m. in New York, the shares were trading at $41.35, resulting in a market value of $7.76 billion. Taking into account the shares allocated for executives, directors, and employees, the diluted value of the company is estimated to be around $8.4 billion. L Catterton offered 21.5 million shares, while the company sold 10.8 million.

According to filings with the US Securities and Exchange Commission, even after the IPO, L Catterton and its affiliates will retain approximately 83% of the stock and maintain control of the company. Leading the offering were prestigious financial institutions such as Goldman Sachs Group Inc., JPMorgan Chase & Co., and Morgan Stanley. The shares of Birkenstock are now listed on the New York Stock Exchange under the symbol BIRK.

This disappointing debut for Birkenstock in the stock market raises concerns about the overall performance of US listings. It also highlights the challenges faced by companies seeking to go public in a volatile and uncertain market environment. Despite this setback, Birkenstock remains a prominent brand with a loyal customer base, and it will be interesting to see how the company’s stock performs in the coming months.

Useful links:
Bloomberg – Birkenstock’s IPO Trading Begins in New York
SEC filing – Birkenstock Holding Plc IPO prospectus