© Reuters.
In a disappointing debut, Birkenstock’s initial public offering (IPO) on Thursday saw a 12.6% decline, marking the worst first-day performance for a US listing of over $1 billion in over two years. The German company’s shares traded at $41 after being sold for $46 in the IPO, ending the day at $40.20. This resulted in Birkenstock having a market value of $7.55 billion.
The most recent company to perform worse was AppLovin, which saw its shares end significantly lower, at 18.5% below their IPO price in April 2021. Other shoemakers’ shares also haven’t fared well since going public in 2021.
Despite this setback, Birkenstock remains profitable and plans to use the IPO proceeds to repay debt. The company has been bolstered by high-fashion collaborations and an appearance in the Barbie movie, which have enhanced its brand image and boosted sales. Birkenstock has also invested heavily in expanding production sites in Germany.
Notably, Bernard Arnault’s family holding company invested in the IPO. Up to 8% of shares were allocated to employees, while L Catterton and Arnault’s family investment company acquired a majority stake more than two years ago.
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