Milan
The trouble in trainers: British private equity firm Permira has shelved its €600m initial public offering (IPO) of Italian luxury sportswear brand Golden Goose because of the “significant deterioration in market conditions” amid the political uncertainty in Europe. The IPO in Milan had been lauded as one of the highlights of 2024 with a €3bn enterprise value. But the IPO faced headwinds from “the 3Ms” – Doc Martens, mid-cap status and French president Emmanuel Macron, says Craig Coben in the Financial Times.
The memory of the disappointing London IPO of Doc Martens in 2021 lingers, while Golden Goose shares had been priced near the bottom of their range. Mid-cap IPOs, as Golden Goose’s would be, have less margin for error, and demand greater price concessions. The deal size may also have been too large, leading to a lack of fundamental demand. Macron’s snap parliamentary election also hasn’t helped, causing a sell-off in European equities.
Ultimately, the withdrawal from the IPO may have spared investors from immediate losses and raised questions about “whether the market is open to the substantial number of mid-cap IPOs in the pipeline”.
Meanwhile, Nike is expected to report a 1% increase in annual sales – its worst performance since 1999, says Lex in the same paper. Competition, cautious consumers and strategic mistakes, such as relying too much on retro trainer sales and neglecting the athletics market, are to blame. Profits are growing again thanks to cost cutting, “but confronting new upstart rivals will require a faster pace of change”.
Indianapolis
New Alzheimer’s drug: Biogen and its partner Eisai may benefit from the entry of a new competitor in the Alzheimer’s drug market, says David Wainer in The Wall Street Journal. Last year their drug Leqembi was approved by the US Food and Drug Administration (FDA), but it has struggled to gain traction. Pharmaceutical giant Eli Lilly’s Alzheimer’s drug, Donanemab, on the other hand, received unanimous support from FDA advisers and is awaiting approval. The increasing prevalence of dementia as people live longer presents a market opportunity. Both Leqembi and Donanemab target amyloid plaques in the brain and they can potentially slow down the disease’s progression. Donanemab, in particular, showed promise in slowing decline by 35% in a study of more than 1,730 patients. As these drugs generate returns, it will boost confidence in researching newer therapies to shift focus from coping with the disease to treating it.
