German multinational corporation Adidas has agreed to sell its underperforming Reebok business to retail behemoth Authentic Brands Group (ABG) for up to $2.5 billion.
The sportswear manufacturer said in a statement that the majority of the sale price will be paid in cash at the closing of the transaction. The deal is expected to close in the first half of 2022. Adidas noted that it intends to “share the majority of the cash proceeds to be received upon closing with its shareholders.”
“Reebok has been a valued part of Adidas, and we are grateful for the contributions the brand and the team behind it have made to our company. With this change in ownership, we believe the Reebok brand will be well-positioned for long-term success. As for Adidas, we will continue to focus our efforts on executing our ‘Own the Game’ strategy that will enable us to grow in an attractive industry, gain market share, and create sustainable value for all of our stakeholders.”
Mr. Jamie Salter Founder, CEO, and Chairman of ABG said, “It’s an honor to be entrusted with carrying Reebok’s legacy forward. This is an important milestone for ABG, and we are committed to preserving Reebok’s integrity, innovation, and values — including its presence in bricks and mortar.”
Authentic Brands, which filed for an IPO in the United States in July, has previously bought over 30 brands, including bankrupt properties like Barneys New York and Brooks Brothers. Through this acquisition, Authentic Brands aims to keep the brand’s global footprint across retail, wholesale, and eCommerce channels.
Reebok is a sneaker and sports apparel firm that operates in 80 countries, with roughly 70 percent of its revenue coming from outside the US and Canada.
The sale of Reebok “has no impact on Adidas’ financial outlook for the current year or the company’s 2025 financial ambition that was announced as part of its Own the Game strategy in March,” the German company added.