Due to underperformance, Adidas oscillates between selling and keeping Reebok
Uncertainty looms over one of the most famous sport apparel brands – Reebok, as its mother-company Adidas can't decide between selling it and keeping it.
The German sportswear company announced that given the fact that it has started to develop its five-year strategy, and it is considering "strategic alternatives" for Reebok, including "both a potential sale of Reebok as well as Reebok remaining a part of the company."
Focusing on the US market, Reebok became part of the Adidas family in 2005, when the latter paid $3.8 billion. Initially, the company was bought so that Adidas could secure its presence in North America and compete side by side with Nike, considering that at that time, Reebok had deals with National Basketball Association (#NBA) and the National Football League (#NFL).
Over the years, Reebok's contribution to Adidas' overall sales dropped to 7% from an initial 20%.
Specialists believe that if Adidas decides to sell, Reebok will end up at VF Corp – the parent company of #Vans and The North face – which bought #Supreme for $2.1 billion. Other possible suitors could be Authentic Brands Group and Anta Sports.
Adidas will make an official announcement on March 10.
At the moment of writing, Adidas stock price is trading 1.53% higher.
Sources: finance.yahoo.com, edition.cnn.com
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