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Birkenstock's Biggest Shareholder is Selling Millions of Shares, Sending Shares Lower

June 25, 2024
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Shares of Birkenstock Holding declined in after-hours trading on Monday following the announcement that its largest shareholder plans to sell a portion of its stake in the company through a public offering.

This secondary offering, involving 14 million shares, is being made by an entity associated with L Catterton, a private-equity firm partially created by luxury brand conglomerate LVMH. The affiliate responsible for this sale is BK LC Lux MidCo S.a r.l.

Post-offering, L Catterton will still hold 73.2% of Birkenstock's ordinary outstanding shares. Despite the announcement, shares of Birkenstock fell 5% after hours on Monday, though they have risen 22.7% this year since the stock began trading publicly in October.

Birkenstock Chief Executive Oliver Reichert stated that the secondary offering is a strategic move to broaden their investor base and increase stock liquidity, supported by the positive outlook and strong performance of the business.

In its May quarterly results, Birkenstock raised its full-year sales forecast due to increasing demand for its footwear, which has surpassed supply. Their "closed-toe silhouettes," such as the Boston clogs, have also been particularly popular.

L Catterton has sole voting power over approximately 9.9 million of the shares being offered. The firm, along with Birkenstock executives and employees, controls the voting power over the remaining shares. L Catterton also plans to provide the underwriters with a 30-day option to purchase up to 2.1 million additional shares.

Proceeds from the sales of shares owned by Birkenstock executives and employees will be used to cover taxes related to the company’s IPO.

Michael Chu, the co-CEO of L Catterton and Birkenstock’s board chair, reaffirmed their commitment to Birkenstock, expressing confidence in the company's growth potential. He emphasized that as a lead investor and the largest shareholder, L Catterton is dedicated to executing the transaction responsibly.

Goldman Sachs and J.P. Morgan are the joint lead book-running managers for the proposed offering.

Editorial Board
Eric Ng
John Liu
Editorial Board
Bryan Curtis
Adan Harris
Managing Editor
Cathy Hills
Associate Editor

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