Adidas sells Reebok to Authentic Brands for $ 2.5 billion
Adidas (ADDYY) has struck a deal to sell Reebok to Authentic Brands for nearly $ 2.5 billion, in a majority cash deal.
The German sports retailer bought Reebok in 2006 for $ 3.8 billion in order to compete with Nike (NKE). However, after 15 years of below expectation sales, it is ready to part ways with the American brand.
“Reebok has been a valuable part of Adidas, and we are grateful for the contributions the brand and the team behind it have made to our business. With this change in ownership, we believe the Reebok brand will be well positioned for long-term success, ”Kasper Rorsted, CEO of Adidas AG, said in a statement.
“With regard to Adidas, we will continue to focus our efforts on executing our ‘Own the Game’ strategy which will allow us to grow in an attractive industry, gain market share and create sustainable value for all. our stakeholders, ”Rorsted added.
Rick Helfenbein, a retail and fashion consultant and former CEO of the American Apparel & Footwear Association, told Yahoo Finance that this is a great opportunity for its new owner.
“The purchase of Reebok by Authentic Brands is really great news for a much-loved name. The wisdom of the industry is that brands only die in the minds of their owners, while the general public is generally unaware of business-to-business transactions. With the strength behind Authentic Brands, expect Reebok to become a leader in a very active market, ”said Helfenbein.
The deal is expected to be finalized in the first quarter of 2022. Authentic Brands Group, owned by BlackRock (BLK), is no stranger to the clothing and footwear space with Aéropostale, Airwalk and IZOD under its umbrella.
Reggie Wade is a writer for Yahoo Finance. Follow him on Twitter at @ReggieWade.
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