CrossFit Creator Pushes Adidas to Sell Reebok, Analysts React

CrossFit creator, Greg Glassman, has added his name to the list of market watchers and not so tongue-in-cheek commentators who are pressing Adidas Group to sell-off Reebok.

Glassman, though, has a different stake in the issue—his company is five years into a 10-year sponsorship deal with Reebok. And, in a clip from a candid interview for CBS’ “60 Minutes,” Glassman held no punches.

“I’d like to see Reebok sold,” said Glassman, creator behind the popular CrossFit workout regimen and fitness company. “[I’d like to see them sold] to someone young, fresh, excited and willing to enter into the modern era of things.”

Adidas held its Q1 earnings call on May 5, during which CEO Herbert Hainer pointed to 9 percent currency-neutral revenue gains at Reebok as proof of the brand’s strong momentum and staying power.

“I definitely see for Adidas and for Reebok [that the] growth path is forward, as we’ve said, this is not a sprint, this is a marathon because this is the most competitive market for us,” said Hainer on the call. “We will build brand desirability by more investing into our brand campaigns as we’ve [said] six months ago and as we’ve started to do in the first quarter already.”

While Hainer and his team continue to deliver a positive outlook on the Reebok brand in the face of its struggles in the North American market, analysts say there’s more to that “no-sell” strategy than saving face.

“At the end of the day, you don’t want to sell low,” said MorningStar analyst Paul Swinand. “So what they are doing is right, reposition and make it unique brand positioning—not competing with the Adidas brand.”

Swinand added that while fresh capital and new management could reinvigorate older brands, “it’s not like Adidas is bleeding so much cash that they have to sell.”

B Riley & Co. analyst Jeff Van Sinderen said he’s not surprised by Adidas’ positive “posturing” on Reebok but that a sale should happen if progress isn’t accelerated in the near future.

“I would not be surprised to see increasing pressure on the company to make [a Reebok sale] happen,” said Van Sinderen. “In reality, Adidas might not be terribly opposed to selling Reebok at fair terms, but doubt they are going to posture that [this] is the case—at least not at this juncture.”

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