There's big money in trendy sandals.
German shoemaker Birkenstock could be valued at up to $10 billion when it lists its shares on the stock market for the first time.
The iconic footwear brand plans to sell shares for between $44 and $49 apiece when it debuts on the New York Stock Exchange, aiming to raise as much as $1.6 billion, it said in a filing Monday. It did not set a date for its initial public offering.
At the top of the price range, Birkenstock would have a market capitalization of $9.9 billion, once all shares in the company — including those held by existing investors and shares issued to employees — are taken into account.
The family-owned firm traces its origins back to 1774, when church archives mention Johannes Birkenstock, who worked as a cobbler in Langen-Bergheim, Germany.
In 2021, L Catterton, a private equity firm backed by French luxury giant LVMH — which owns brands such as Tiffany & Co. and Dior — bought a majority stake in Birkenstock. Brothers Christian and Alex Birkenstock retained a minority stake.
The company has ballooned in recent years, its revenues surging by 71% between the 2020 and 2022 financial years, according to Monday's filing. In the nine months to the end of June this year, revenues grew 21% compared with the same period in 2022 to reach €1.12 billion ($1.17 billion). The firm made a pre-tax profit of €154.2 million ($161.7 million) in that period.
Birkenstock scored a major boost to its profile this summer when a pair of its sandals was featured in the wildly successful "Barbie" movie. (CNN and "Barbie" distributor Warner Bros. Pictures have the same parent company, Warner Bros. Discovery.)
The shoemaker's upcoming listing is a coup for the US market, and another loss for stock exchanges in Europe. UK-based chip designer Arm (ARM) was lured to US shores last month, listing on the Nasdaq, and currently has a market capitalization of $54 billion.
Birkenstock's IPO is also one of a number of high-profile listings this year that have raised hopes among investors of a revival in the global market for new share issues after an 18-month slump.
Listings in Europe and the United States in particular have been hamstrung by high interest rates, which have lifted returns on safe assets such as government bonds and dented investors' appetite for riskier bets.
"Birkenstock's step is another sign that the IPO engine is whirring back to life after an 18-month downturn," Susannah Streeter, head of money and markets at Hargreaves Lansdown, said in a note Monday.
However, the volatility in share prices seen after recent listings, such as those of Arm and grocery delivery firm Instacart (CART), "highlights that investor sentiment is still highly sensitive, particularly given the realization that high interest rates are set to linger," she added.
