The coronavirus pandemic is raging through the world, destroying everything that crosses its path. This time, sportswear company Reebok fell prey to the deadly pandemic. It has recently been reported that Adidas will sell the Reebok brand to Authentic Brands Group. Since 2016, Adidas endeavoured to bring the struggling business back to life. However, it did not help and the brand kept lagging far behind its parent company. With the outbreak of the coronavirus, everything changed for the worse.
This urged the German sportswear giant to sell its subsidiary to Authentic Brands Group that owns over 30 brands, including Juicy Сouture and Forever 21. The deal is expected to be closed in the winter of 2022. According to Adidas, the sale of Reebok will have no impact on its outlook for the current year or for its 2025 financial ambition that was announced in March.
Adidas acquired Reebok for $3.8 billion in 2006 to take on Nike, the company’s main rival in the sporting and athletic goods market. Eventually, it became clear that the goal was not accomplished and that the acquisition was not worth it. Adidas now has to sell the brand for $2.5 billion, which is less than it originally paid. In fact, Adidas conquered the US market not by purchasing Reebok but owing to its collaboration with celebrities like Beyoncé, Kanye West, Pharrell Williams, and others.
