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Dr. Martens: a well-heeled flotation for a footwear favourite

Boots for the suits?
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Prepare for a stomping big float, said the Financial Times. Dr. Martens, the classic British boot brand favoured by everyone from skinheads to fashionistas, is planning to float in London, in “one of the first big IPOs of 2021”. The company, 75% owned by the private equity group Permira, comes to market on a roll. “The brand name has always been much bigger than the business,” said CEO Kenny Wilson, but in recent years “we have taken the business to a completely different level.” Indeed, the pandemic has proved a boon for the gritty boot manufacturer. Dr. Martens sold 700,000 more pairs year-on-year in the six months to October, many via its online shop.

The company likes to “emphasise the variety of its offerings”, said Saabira Chaudhuri in The Wall Street Journal. But the core product remains the boots, which began life in 1945 when Klaus Märtens, a German army doctor suffering from an injured foot, “created an aircushioned sole”. Brought to Britain as working boots in the 1960s by shoe manufacturer R. Griggs, DMs gained youth cred when Pete Townshend of The Who began wearing them, and have never really lost it – despite a close shave with bankruptcy around the millennium.

Having bought Dr. Martens out of family ownership for £300m in 2014, Permira is now reportedly hoping for £3bn plus, said Nils Pratley in The Guardian. Beware the hype. The London-based buyout group has a history of “shunting” over-indebted British companies on to the market: “the mugs who bought shares in AA and Saga at flotation are still counting the cost”, though it should be said that Dr. Martens looks “a superior operation”. Still, the valuation (at 4.5 times last year’s sales) looks “punchy”, said Alistair Osborne in The Times. At that price, you’d have to be brave to “jump in with both feet”.