Adidas Prepares to Sell Reebok
According to a report from German business magazine Manager Magazin, Adidas has initiated the sale of Reebok.
Remind me: Adidas purchased Boston-based Reebok for $3.8 billion in 2005, as a play by the Germany-rooted sports company to compete with Nike, a leader in the American market.
For the past decade, Reebok has been the exclusive title sponsor for the CrossFit Games and sponsors many athletes, including Rich Froning, Patrick Vellner, and Haley Adams.
But, a decrease in Reebok sales has pushed Adidas CEO Kasper Rørsted to explore selling the company.
- This sale comes after four years of attempted-Reebok revitalization from Rørsted, who stepped into the CEO position in 2016. Reebok was finally profitable in 2019, though investors had already been calling for Rørsted to sell.
- A report from Adidas in April notes how hard the pandemic hit Reebok; the brand’s sales fell 42% in the second quarter. Adidas’s only fell 33%.
Manager Magazin calls the purchase of Reebok the brand’s “most expensive mistake.” Rørsted originally hoped to sell Reebok for $2.4 billion, but is now expected to settle for less.
The details: There’s nothing conclusive yet. Manager Magazin says that Rørsted plans to have Reebok sold by March of 2021, though a report from Bloomberg contradicts this, saying “the company will decide in the coming months” if they will proceed with the sale. The German magazine does not have a cited source for it’s information.
- Bloomberg also notes that an Adidas spokesperson said the company refuses to comment on “market rumors.”
After the German magazine’s report was released, Adidas shares rose around 3.4%.
According to Manager Magazin, brands interested in purchasing Reebok include VF Corp., owner of Timberland and North Face, and China’s Anta International Group Holdings.