Adidas, a multinational corporation and one of the world's largest sportswear companies, made a significant business move in 2005 when it decided to acquire Reebok, another leading sportswear company. The acquisition was a strategic decision for Adidas, as it allowed the company to expand its market presence and diversify its product offerings.
Before the acquisition, Adidas was primarily known for its footwear and apparel products in the athletic and sports performance markets. Reebok, on the other hand, was known for its casual and lifestyle products, as well as its strong presence in the fitness and training markets. The acquisition gave Adidas access to Reebok's diverse product lines and customer base, allowing the company to broaden its reach and appeal to a wider range of consumers.
One of the primary reasons for the acquisition was to increase Adidas's market share and competitiveness in the highly saturated and competitive sportswear industry. By acquiring Reebok, Adidas gained access to Reebok's extensive distribution network and established relationships with retailers, which helped the company expand its reach and sales. The acquisition also allowed Adidas to tap into Reebok's strong presence in emerging markets, such as India and China, where the company had a significant presence.
Another reason for the acquisition was to take advantage of the synergies between the two companies. Both Adidas and Reebok had strong research and development capabilities and shared similar values and corporate cultures. The acquisition allowed the two companies to combine their expertise and resources, which enabled them to create innovative and high-quality products more efficiently.
Overall, the acquisition of Reebok by Adidas was a smart business move that allowed the company to expand its market presence, diversify its product offerings, and take advantage of synergies between the two companies. The acquisition has been successful in helping Adidas become one of the leading sportswear companies in the world.
When Adidas Bought Reebok, the Company Seemed Like a Powerhouse
Previously a sports generalist, the brand shrunk under Adidas to focus on the fitness and athletics side of the market, which analysts say was the result of not wanting the two brands to compete with each other. Reebok's recent collaborations with celebrities like Cardi B and a renewed focus on women's apparel have put it in a better place, analysts say. The company first announced it would divest Reebok in February. As a result, it was neither seen as the go-to brand for sporting professionals nor for those looking for athleisure fashion and style. Both companies said the transaction could close during the first half of 2006. Its brands include apparel chains Aéropostale and Forever21, as well as and Sports Illustrated magazine.
English soccer star David Beckham and rap artist Missy Elliott are under contract to Adidas. As a result of this deal, Adidas-Salomon AG and Reebok will be able to expand their geographic reach, boost their research and development capabilities, and offer their customers more options than they had before. . Chief Financial Officer Robin Stalker said the deal would likely lead to little if any significant restructuring costs. The brand also foresaw the trend of driving sneaker sales through pop culture by partnering with musicians like 50 Cent and Jay-Z. It said it would share the majority of the cash proceeds with its shareholders.
Authentic Brands Group to acquire Reebok for $2.5B
Although the company could not compete with Nike, it took the lead in the market. They have the taste of being at the top. FITNESS PLAN After Kasper Rorsted took over asAdidasCEO in 2016, he launched a turnaround plan which helped Reebok return to profitability, but its performance continued to lag that of the coreAdidasbrand and it was then hit by the COVID-19 pandemic. Reebok began to focus more on hip-hop and real estate projects as time went on. Still, Finlayson said, the combination of the companies could give them more muscle in dealing with suppliers and retailers. The closing of the transaction is subject to customary closing conditions and is expected to occur in the first quarter of 2022.
Adidas ends Reebok era with $2.5 bln sale to Authentic Brands
Adidas has also been working on rebranding the Reebok brand to move away from varsity sports and training gear. Despite their efforts, the company has not been able to adapt to the ever-changing taste and management. Reebok will keep its headquarters in Boston and continue operations in North and Latin America, Asia-Pacific, Europe and Russia, the U. It also owns Sports Illustrated magazine. O'Neal, an owner of Authentic Brands, called the acquisition of Reebok a "dream come true. According to reports, Adidas has agreed to sell Reebok to Authentic Brands Group for EUR2. But what will happen to Reebok after the sale? Its global sales between At the time, Adidas was strong on its home turf in Europe but had been struggling to gain a foothold in the US.
The company also saw the potential for an equal product line for men and women. He knew the importance of a sports brand, and he knew that Reebok had the potential to be successful in the sports market. Adidas said the majority of the 2. ABG, which recently filed for an initial public offering in the US, has bought several brands in the bankruptcy process including Barneys New York and Brooks Brothers. Reebok was an international company until Paul Fireman bought the U.
While Reebok President Matt O'Toole told Retail Dive earlier this year that a sale could open an opportunity for Reebok to expand again into other sports categories, Authentic Brands stayed focused on the brand's fitness positioning in its statement. Fireman had experienced nothing but losses when working with the NFL. Adidas bought Reebok to help it compete with rival Nike, but in the end, partnerships with celebrities like Pharrell Williams proved to be a better assist. Adidas said it did not expect any significant reductions in the work forces of both companies. Reebok would in theory allow it to do that. CrossFit athlete Rich Froning Jr. I think now it's: Don't stand in the way.
Adidas sells Reebok to US conglomerate after shareholder pressure
It also has deep ties to professional sports. Please select at least one newsletter. What's to stop it happening again? Getty Images for Adidas The German company said in a statement that the sale had no impact on its financial outlook for the current year or for its targets set out in the five-year strategy it announced in March. So the company is leaving the reins of the company to another entity. But now, the company can license the rights to other brands in specific geographic areas and product categories.
Adidas sells Reebok to Authentic Brands for $2.5 billion
The brand was losing money. But if there was any momentum building at Reebok, the pandemic interrupted it. Notably, Adidas is selling Reebok for far less than it paid for it which serves to underline the degree to which brand equity has been eroded. In 2016 Reebok initiated a turnaround plan called "Muscle Up" through which the brand was able to significantly improve its growth and profitability prospects. Please select at least one newsletter. It realized the two companies could better reach their potential apart than together, it The decision was arguably overdue.
As the brand owner, he acted as a business visionary and human rights champion, challenging corporate America to become more socially responsible. This deal is expected to close in the first quarter of 2022, and Adidas will share the remaining cash with them. Reebok had to focus all of its resources on one geography and a particular category of shoes in the past. Fireman buys reebok out of Adidas. Adidas shares rose more than 7 percent in Frankfurt trading.
