L Catterton, a leading global consumer-focused private equity firm, announced that together with Financière Agache it has acquired a majority stake in global lifestyle brand Birkenstock. In partnership with L Catterton, Birkenstock intends to continue its growth trajectory by investing further in its business and expanding its market leadership in Europe and North America while growing its presence in future markets, particularly in China and Asia.

Birkenstock is a nearly 250-year-old brand best known for its sandals, which are popular with hippies and fashion icons alike. The style has spawned a range of luxury variants from labels including Celine and Givenchy, following a celebrity-powered bump in the 1990s and 2000s. The company sold more than 25 million pairs of shoes in the past year, generating sales of close to Euro 800 million. Oliver Reichert said: "L Catterton and Financière Agache have an unmatched expertise and international network of resources, and we are confident this partnership will serve as a major leap forward for Birkenstock. Our company has long been at the forefront of the footwear and lifestyle industry worldwide thanks to the outstanding skills and abilities of our people. Today we are opening a new, very promising chapter in the company's history."

L Carterton and the family investment company of billionaire Bernard Arnault will acquire a majority stake in Birkenstock, while Brothers Christian and Alex Birkenstock will retain a stake in the firm. Bloomberg News reported earlier this week that the purchase would value the sandal maker at about Euro 4 billion. L Catterton beat out a rival offer from buyout firm CVC Capital Partners and Permira. Apparently, the owners of Birkenstock preferred L Catterton’s track record with family-backed consumer brands as well as its ability to expand in Asia. L Catterton was created in 2016 by combining U.S. investment firm Catterton with the private equity operations of LVMH and its founder Arnault. The firm now manages more than USD 23 billion of assets and Its investments have included Pepe Jeans, Sweaty Betty, Pinarello and Everlane.

The Birkenstock deal adds to the market heating up around exclusive consumer brands, which are able to build a loyal following and close connection with their customer, in turn creating a community. Companies like Gymshark and BAPE, or Supreme and Stone Island have either attracted financial investments from a private equity or have been acquired by a strategic player respectively.

L Catterton was joined in the deal by Financiere Agache, the family investment company of Bernard Arnault. “Together we will provide support to the business so it can fully realize its significant growth potential,” Arnault, France’s wealthiest man, said in today’s statement. Historic family-controlled companies like Birkenstock have been putting themselves on the block, as their wealthy owners look to capitalize on surging valuations for consumer companies. Private equity firms have been drawn to such businesses, which can be leveraged to boost sales and attract investors through an eventual initial public offering. LVMH in 2016 acquired German suitcase maker Rimowa from the grandson of the founder. Family-owned luxury companies, from jewelry house Bulgari to cashmere specialist Loro Piana, have also sold out to become part of conglomerates like LVMH.

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L CATTERTON ACQUIRED BIRKENSTOCK