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Winning streak: All eyes on Golden Goose in hope of one last IPO success before big deals return in September

Over the next few weeks, investors will pore over the last of Europe’s pre-summer IPOs, with all eyes on Permira-owned shoe manufacturer Golden Goose, set to price this week.

The market is hoping that these final new listings before the traditional August break – particularly the high-profile Golden Goose – will be roaring successes that will provide some impetus to the big deals scheduled for September.

“Golden Goose needs to go well, and we all genuinely hope it does,” said an ECM banker not working on the deal. “We want the buyside to go into the summer happy.”

Permira opened the books for the IPO of the Italian footwear company last week, pitching it a significant discount to Italian luxury jacket maker Moncler [BIT:MONC].

The IPO price range of EUR 9.5 to EUR 10.5 per share implies a post-money market cap of EUR 1.7bn to EUR 1.9bn. Assuming Golden Goose’s 19% EBITDA growth in 2023 will be repeated this year, the price range suggests a 2024 EV/EBITDA multiple of 8.8x at the bottom and 9.7x at the top, as per an analysis by this news service.

While that entire range encompasses a serious enterprise value discount to Moncler, which is trading at around 12.3x EV/EBITDA*, investors told ECM Pulse they would prefer the deal to price in the bottom half to give the stock enough of a discount to help it trade up in the aftermarket.

A more sceptical buysider previously told this news service that Golden Goose does not, in his opinion, have the same luxury prestige as Moncler, a point echoed by FT’s Lex column last week.

The first investor was more positive on the company, however, and noted that Permira has clearly set a price range that could work for most of the market.

It appears it got that right. On the first day of books being open, the deal syndicate sent out a message saying the deal was covered across its price range, according to two sources close to the deal.

“The fact Golden Goose can get to the position of launching and getting covered so quickly is very encouraging, given that there is still some scepticism around mid-cap stories,” said the first banker.

One of the sources noted that the addition of Invesco as a cornerstone, subscribing for EUR 100m worth of shares at the final price had generated strong momentum for the deal, and there is enough conviction for a successful IPO around the middle of the price range.

Meanwhile, this news service reported late last week that Golden Goose is likely to be joined in the IPO market by Spanish bakery Europastry, possibly as early as next week.

Performance bonus

All in all, Europe’s IPO market will enter summer on an alpha high.

According to Dealogic year-to-date data, European IPOs (excluding Turkey), have generated a weighted return of around 19.8% for investors above the IPO price, outperforming the S&P 500 and substantially outshining the Stoxx 600. New listings in Europe have also slightly outperformed deals priced in the US, which had a weighted average return of 17.7% above IPO price.

Europe’s alpha is also more consistent, with around 76% of IPOs priced in this region trading above the offer price, compared with around 50% of deals priced in the US, Dealogic data show.

A graph of a number of ips

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Source: Dealogic. European IPOs excl. Turkey, versus US IPOs

The first banker, and the investors speaking to ECM Pulse this week, argued that a successful Golden Goose IPO would set up the market perfectly for a big listing window when people go back to their desks post the summer break.

Singapore-headquartered fast fashion giant Sheinexpected to list in  London, Springer Nature  and Stepstone  are all in the pipe for 2H, according to Dealogic’s IPO pipeline.

Several sources also told ECM Pulse they are excited about several other much discussed IPO candidates, including Coca-Cola Beverages Africa.

Spanish firm Hotelbeds and Germany’s Flix are also possible deals for 2H, although both processes have recently been delayed.

Should Golden Goose add to Europe’s recent IPO wins, then market sources are confident of a strong reception for the next big deal crop in September.

“We think that the deals post-summer are going to be launched into a very good environment. People are very nimble and pragmatic on things, even on events like the US election,” said the banker. “There will be plenty of big deals in September, but for now all eyes are on Golden Goose.”

Permira declined to comment on this story.

*according to data from Fidessa provided by FactSet