No business like shoe business: LVMH-backed tycoon buys Birkenstock
Veteran French businessman Bernard Arnault has emerged as the soul behind the multibillion euro purchase of the family-owned German sandal maker Birkenstock.
Arnault's family holding fund Financière Agache and L Catterton, an equity firm co-founded by his LVMH luxury goods empire, are understood to have paid four billion euros for the German company which was set up in 1774.
"For the next 250 years we need partners sharing the same strategic and long-term vision as the Birkenstock family," brothers Christian and Alex Birkenstock said in a statement.
The ownership switch represents a different path for the business set up by Johann Adam Birkenstock 60km south of Bonn in Neustadt (Wied) to make orthopaedic shoes.
By 1897, Konrad Birkenstock, Johann’s great-great-grandson, had created the first flexible base to fit the contours of the feet.
Within 30 years, he had expanded the company with the acquisition of a large factory 150 kilometres east in Friedberg.
By the mid 1960s, the sandals - unabashed about their wide straps added to cork and latex soles - were de rigueur for soles tripping along in the flower power and hippie sub-cultures in the United States.
The brand acquired glamour when supermodel Kate Moss wore them during a magazine fashion shoot during her heyday in the early 1990s. Their time as an accessory for cognoscenti past, the sandals have remained part of mainstream fashion consciousness.
That cross generational appeal helped Birkenstock sell nearly 24 million pairs of shoes in the financial year through to September 2019, with revenues rising 11 percent to 721.5 million euros and a profit of around 130 million euros.
“We will get excellent market access and contacts in Asia through the new co-owners, and can push on with our growth at an accelerated pace," Birkenstock chief executive Oliver Reichert told the business newspaper Handelsblatt.
"The new co-owners will bring both a deep understanding of the details of a manufacturing business that is all about quality and a respect for brands with a long heritage like ours," added the brothers Birkenstock, who will retain a stake in the company which employs 4,300 people around the world.
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