Levi Strauss Files IPO to Trade on New York Stock Exchange
Rumors have been floating around for months that denim maker Levi Strauss & Co. would be turning its private company into a publicly traded company.
On Feb. 13, the San Francisco apparel giant did exactly that after being gone from the stock market for more than three decades. Company executives said the number of shares to be offered and the price range for the proposed offering have not been determined yet. But the company intends to list its Class A common stock on the New York Stock Exchange under the ticker symbol “LEVI.”
On the financial front, Levi Strauss has had several quarters of strong revenue growth despite the fact that the denim market has seen stiff competition from the athleisure category, with yoga pants and leggings in recent years taking a big bite out of blue-jeans sales.
For fiscal 2018, ending Nov. 25, 2018, Levi’s net revenues increased a healthy 14 percent to $5.6 billion. But net income for the fiscal year was flat, remaining at $285 million.
At the time of the earnings announcement, Levi’s president and chief executive, Chip Bergh, said the company’s strategies to diversify its product portfolio, expand its direct-to-consumer business and deepen the company’s connection with consumers worldwide have been working.
The company has set a placeholder amount of $100 million to indicate the size of the IPO, whose amount could grow. Levi’s said the proposed offering will be made only by means of a prospectus, which will be available through the investment banks handling the IPO. Those are Goldman Sachs & Co., JPMorgan, BofA Merrill Lynch and Morgan Stanley.
Levi Strauss & Co. was founded in 1873 by German immigrant Levi Strauss, who traveled west to open a dry-goods store in San Francisco and ended up making sturdy denim pants for gold miners attracted to California during the Gold Rush era. He and Jacob Davis obtained a U.S. patent on the process of putting rivets on men’s work pants, and those rivets are still an integral part of the blue jeans.
With the money raised from an IPO, Levi Strauss could start acquiring other companies, merge with other labels or expand its products, experts said.
The privately held company is controlled by the descendents of Levi Strauss, but it is required to publicly post quarterly earnings and hold conference calls on earnings results because its Japanese arm, Levi Strauss K.K., is publicly traded in Tokyo.
Over the years, the company has expanded beyond the Levi’s label. In 1986, it introduced Dockers, a casual khaki pant that could be worn to work, and then came out with lower-priced denim under the Denizen and Signature labels, which have been doing well in several markets, including the United States.