Adidas Agrees to Sell Reebok to Authentic Brands

Adidas AG said it has agreed to sell Reebok to Authentic Brands Group for up to 2.1 billion euros, the equivalent of $2.47 billion, roughly 15 years after acquiring the U.S. fitness brand and trying to revamp it.

The German sporting-goods company managed to improve the Reebok business, but its sales lagged behind those of Adidas itself and dragged down the group’s profits. Adidas, which in December 2020 said it was exploring a Reebok deal, acquired the brand in 2006 for roughly €3 billion as part of a bid to expand in the U.S.

Over the past few years, brand-management company Authentic Brands has made a name for itself by picking up downtrodden retail brands including JCPenney and Forever 21.

Adidas on Thursday said the majority of the transaction will be paid in cash at the closing of the transaction, with the remainder made up of deferred and contingent fees. The company said it plans to share much of the cash proceeds with shareholders after the deal is expected to close in the first quarter of 2022.

Authentic Brands will keep Reebok’s bricks-and-mortar presence, said Jamie Salter, the company’s founder and chief executive.