Canada Goose Set for Debut With Richest Luxury Valuation

Updated on
  • High-end coatmaker to trade Thursday in New York and Toronto
  • Bain Capital will keep controlling interest after IPO

Canada Goose Seeks to Raise $240M in Luxury Parka IPO

Canada Goose Holdings Inc., the maker of $900 parkas worn by celebrities from Toronto rapper Drake to Blue Jays slugger Jose Bautista, is going public with a richer valuation than any other luxury retailer in the world.

The Toronto-based retailer raised C$340 million ($256 million) in its initial public offering, pricing the shares at C$17 a piece, above the marketed range of C$14 to C$16 a share, according to a statement Wednesday. At the IPO price, the company has a market value of about C$1.82 billion.

That valuation would give Canada Goose a price-to-earnings multiple of 45.5 times, using conservative growth estimates, making it the highest among luxury goods companies, Bloomberg Intelligence analyst Maja Rakic wrote in a note Thursday. That number puts it ahead of Hermes International’s 37.2 times and Brunello Cucinelli SpA’s 33.5 times, she wrote.

The shares will start trading Thursday, listed on the Toronto Stock Exchange and the New York Stock Exchange under the symbol GOOS.

“Plans to expand its direct-to-consumer channel should support superior growth," Rakic said. “The company needs to make further investments soon, which could weigh on profit. Keeping tight cost controls while driving sales will be key."

Canada Goose is backed by Bain Capital, which will continue to own a controlling interest in the company following the IPO, according to the prospectus.

Canada Goose was founded in a small warehouse in Toronto in 1957 as Metro Sportswear Ltd., specializing in woolen vests, raincoats and snowmobile suits. In recent years it has shifted its focus to luxury consumers, targeting shoppers who drive Land Rovers rather than dogsleds.

The company plans to expand its offerings into markets including knitwear, footwear, hats and gloves as well as travel gear and bedding in the coming years, the IPO prospectus shows.

In 2013, when Bain acquired a 70 percent stake in Canada Goose, the company was valued at about $250 million, people familiar with the matter have said. Terms weren’t disclosed at the time.

Canadian Imperial Bank of Commerce, Credit Suisse Group AG, Goldman Sachs Group Inc. and RBC Capital Markets managed the offering.

(Updates with analyst comments in third paragraph.)
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