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On Running Prices IPO, Warns on Vietnam Disruption

On Running launched its initial public offering Tuesday, aiming to raise nearly half a billion dollars.

The Swiss athletic brand, which counts tennis supernova Roger Federer among its backers, intends to list its shares under the ticker symbol “ONON” on the New York Stock Exchange.

Priced between $18 and $20 per share, On is making available 25,442,391 Class A ordinary shares while select selling shareholders are putting up 5,657,609 Class A ordinary shares. The sneaker and performance apparel maker, headquartered in Zurich, pegs the offering’s net proceeds at “approximately $448.6 million,” it wrote in an updated F-1 filing with the Securities and Exchange Commission. The funds are earmarked for “general corporate purposes, including working capital, operating expenses, and capital expenditures,” it added.

Though On has quickly risen as a challenger to the likes of Nike, Adidas, Puma and Under Armour, the 11-year-old upstart is suffering the same fate as these established firms, which tap Vietnam for much of their shoe output. The Asian sourcing locale churned out of 97 percent of On’s footwear last year and all of its shoes for the first half of 2021, the Swiss firm noted in the filing, citing ongoing disruption and crippling freight impacts from the latest Covid-19 outbreak there.

“We expect that these disruptions will continue to adversely impact our business, financial condition and results of operations for the remainder of 2021 and 2022,” it wrote of Vietnam’s coronavirus crisis.

On the apparel and accessories side of the business, China manufactures 63 percent of On’s goods, with facilities in Vietnam and Europe accounting for the balance, the company said.

The IPO continues a hot streak for the market, which has seen several apparel and footwear firms make their public debut, including Dr Martens, Allbirds, and A.k.a Brands.

Fabletics, the Kate Hudson-backed athleisure label, is said to be mulling a public offering, while Rent the Runway confidentially filed its SEC paperwork. Shein, which has traditionally kept its cards close to the vest, has been on something of a public-relations campaign in recent months in what very well might be pre-IPO behavior.