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Birkenstock Stock (NYSE: BIRK) A Pre-Market Mover On Shareholder Sale News

Analyst Team trader
Updated 25 Jun 2024

Iconic footwear company Birkenstock stock price (NYSE: BIRK) look set to open almost 5% down, as a sell off in the pre-market session makes the stock a big mover. The news that one of the largest shareholders, L Catterton, (a major private equity holder), sold a significant portion of its holding has caused a little unrest. This move signals a shift in the shareholder composition and has implications for the market’s view of the stock.


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L Catterton’s decision to divest 14 million shares, valued at $836.9 million based on the recent share price of $59.78, was strategically executed with the assistance of financial giants Goldman Sachs and JPMorgan, who are shepherding the sale. Additionally, there’s an over-allotment option that could see 2.1 million more shares sold, provided there's sufficient investor interest.

Despite this large-scale sell-off, L Catterton will retain a sizable interest in Birkenstock, holding onto over 137.5 million shares. This amounts to a 73.2% ownership stake, leaving the investment firm still deeply invested in the company's future.

Birkenstock’s CEO, Oliver Reichert, has commented on the development, framing the share offering as an opportunity to expand the company’s investor base while enhancing the liquidity of the stock. This perspective suggests that the divestment isn’t indicative of a lack of faith in Birkenstock’s potential but is rather a strategic move to improve the health and diversity of the shareholder community.

Michael Chu, CEO of L Catterton, has echoed this sentiment. He confirmed the firm's continuing commitment to Birkenstock, making it clear that they remain “long-term partners” with a “strong belief in the company’s growth.” This sustained commitment is noteworthy, especially considering L Catterton and the French luxury conglomerate LVMH initially acquired a controlling interest in a deal estimated around US$4.4 billion in 2021. Birkenstock later went public in New York, achieving a valuation of US$10 billion in October of the following year.

For investors and market watchers alike, these declarations offer a semblance of stability amid the seismic stock activity. The overall message to the market is that, while the composition of Birkenstock's shareholder base might be evolving, the confidence of its major investors remains steadfast.

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The AskTraders Analyst Team features experts in technical and fundamental analysis, as well as traders specializing in stocks, forex, and cryptocurrency.