Adidas AG may be exploring a sale of Reebok.
The German sportswear giant is reportedly looking to sell the athletic brand and could decide in the next few months whether to move forward with the process, according to a source who spoke with Bloomberg. An internal review is said to be in the early stages, while Germany’s Manager Magazin indicated that Adidas plans to complete the sale by March 2021.
Among the parties interested in acquiring Reebok, wrote Manager Magazin, are Vans and Timberland parent VF Corp. as well as China’s Anta International Group Holdings Ltd. The report indicated that Adidas had written down the value of Reebok by almost half to 842 million euros (or about $995 million at current exchange) since 2018.
FN has reached out to Adidas for comment. A Reebok representative told FN that it does not comment on market rumors as a matter of company policy.
It’s been roughly 15 years since Adidas snapped up Reebok in a $3.8 billion deal. Over the years, Reebok has experienced declining revenues and both of its licensing contracts with the NFL and NBA have expired. Those issues, along with broader challenges surrounding its ability to resonate with U.S. consumers, have prompted analysts, to question whether Reebok’s future is strongly aligned with that of its parent.
Four years ago when he joined Adidas, CEO Kasper Rorsted helped launch a new business strategy for Reebok with the goal of returning it to profitability by 2020. Through its renewed focus on women’s footwear and the resurgence of ’90s fashion trends as well as its enlisting of influencers, including rap star Cardi B, the brand has managed to reintroduce itself to a hipper generation of consumers.
However, its challenges persisted, and in the second quarter reported in August, Reebok posted a 42% decline in revenues — more pronounced than the Adidas brand’s 33% dip in sales — due to its higher exposure to the United States market, which has been heavily impacted by the coronavirus pandemic.
Last year in July, Authentic Brands Group expressed a desire to add the Boston-based company to its growing portfolio. In an interview with FN’s sister publication WWD, chairman and CEO Jamie Salter shared, “My partner [Shaquille O’Neal] beat me to the punch in mentioning it a few weeks ago: I’d love to buy Reebok. Maybe one day Adidas will let it go.”