Adidas explores sale of struggling Reebok business, says report

 

While the firm had hoped for about $2.4 bn from the sale pre-pandemic, it would now be content with less.

Adidas AG, the German sportswear giant, is exploring a sale of its Reebok brand, according to a person familiar with the matter.
The company will decide in the coming months whether to proceed with a sales process, said the person, who asked not to be identified because deliberations are private. The internal review is in the early stages, the person said.

A spokeswoman for Adidas said the company doesn’t comment on market rumours. Adidas shares rose as much as 3.4 per cent in Frankfurt trading.

Since taking over as chief executive officer of Adidas in 2016, 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.

After Reebok finally regained profitability by early 2019, Rorsted expressed hope that he could now generate sales growth with new footwear lines like the CrossFit Nano and the FloatRide Run. He compared overseeing Adidas and Reebok to being like a parent who loves both his children equally.

Reebok in the pandemic has suffered more than the Adidas brand. While sales at the German label fell 33 per cent in the second quarter, Reebok’s revenue fell 42 per cent, the company said. Manager Magazin reported on the review earlier Thursday, and said interested parties include VF Corp., which owns the Timberland and North Face brands, as well as China’s Anta International Group Holdings.

While Rorsted had hoped for about $2.4 billion from selling Reebok before the pandemic, he would now be content with less than that amount, the magazine said. The German company acquired Reebok for $3.8 billion in 2006.