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Is Adidas looking to offload Reebok?

Business

Is Adidas looking to offload Reebok?

By Don-Alvin Adegeest

11 Nov 2020

When Adidas AG agreed to buy Reebok for 3.1 billion euros in 2006 it was to improve its position to challenge Nike, the world’s biggest sportswear brand. By acquiring Reebok, Adidas closed the gap to a “manageable” two billion euros.

But Reebok hasn’t fended Nike off and Adidas is thought to be exploring an imminent sale.

According to Bloomberg Adidas CEO Kasper Rorsted “has repeatedly parried rumours that he was looking to sell the brand. He closed under-performing Reebok stores and allowed some licensing deals to expire, cutting sales at the long unloved sporting label but cutting expenses even more.”

The pandemic has been especially tough for Reebok, which saw revenue fall 42 percent compared to 33 percent at Adidas in the second quarter.

Interested buyers are said to be VF Corp, which owns the newly acquired Supreme skater brand, North Face and Timberland, as well as Anta International Group Holdings from China.

Reebok’s current value is likely to be 2 billion euros, with Germany’s Manager Magazin reporting Rorsted would accept even less. The publication also cited the purchase of Reebok as the most expensive mistake in Adidas’ history.