After a series of negotiations that captivated the footwear business, Adidas has finally sold Reebok to Authentic Brands Group (ABG) for about $2.5 billion. Reebok will now become part of a business that includes Brooks Brothers, Aeropostale and Forever 21.
According to industry reports, the majority of the purchase price will be paid in cash at the closing of the transaction and the remainder comprised of deferred and contingent consideration. The closing is expected to occur in the first quarter of 2022.
“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,” Kasper Rorsted, CEO of Adidas AG, said in a statement.
“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,” he added.
“It’s an honor to be entrusted with carrying Reebok’s legacy forward,” added Jamie Salter, founder, chairman and CEO of ABG. “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. We look forward to working closely with the Reebok team to build on the brand’s success.”
Adidas bought Reebok in 2006 for $3.8 billion. At the time, the acquisition included the Rockport, CCM Hockey and Greg Norman brands, which Adidas later divested for a total consideration of €0.4 billion, according to Adidas’ statement.
In its statement, ABG said that with Reebok, it plans to “use its core playbook, connecting strong brands with best-in-class licensees and a network of partners that seek to optimize value in the marketplace.”
The brand’s world headquarters will remain in Boston and ABG will work closely with Adidas, Reebok’s President Matt O’Toole and the Reebok team to transition the brand to ABG’s platform.