Eight years after acquiring US rival, Reebok, seems like German sports gear marketer – Adidas has put Reebok on the block.
According to WSJ, funds affiliated to the Abu Dhabi Government and a Hong Kong based private-equity investor - Jynwel Capital are in talks with Adidas to buy Reebok and may make an offer very soon.
Adidas acquired Reebok for $3.8 billion in 2006, in an effort to boost sales of its footwear and sporting-apparel and compete with rival - Nike in the US market.
However, sales at Reebok have slipped by more than a third to $2 billion in 2013, since Adidas acquired Reebok in 2006, while accounting for 11 percent of Adidas Group sales.
Quoting sources, WSJ said, “The consortium has bid $2.2 billion for Reebok and it will inject new capital to open new stores and also hike spend on marketing, while retaining current Reebok employees.”
Earlier, in the first week of October, Adidas Group said it will return up to €1.5 billion to Adidas AG shareholders over the next three years, primarily in the form of share buybacks.
In addition, Adidas, which reported sales of €14.5 billion in 2013, stated its commitment to pay an annual dividend to shareholders in the range of 20% to 40% of net income attributable to shareholders. (AR)
