Adidas is offloading Reebok into Authentic Brands Group’s (ABG) burgeoning portfolio of brands as the German sportswear giant seeks to strengthen its own position in a direct-to-consumer (D2C)-led strategy.
The $2.5 billion transaction is expected to close in the first quarter of 2022. The Reebok brand, which Adidas bought in 2006 for $3.8 billion, was essentially discontinued earlier this year as Adidas looked for a buyer in order to focus more on its own footwear.
“With this change in ownership, we believe the Reebok brand will be well-positioned for long-term success,” Adidas CEO Kasper Rorsted said in a statement.
In March, Adidas said it intends to double its eCommerce business over the next five years and increase its focus on attracting more women to the brand. Adidas is also doubling the number of influential “megacities” it focuses on as global hubs for trends and fashion.
Jamie Salter, founder and CEO of Authentic Brands, said the Reebok acquisition “is an important milestone for ABG, and we are committed to preserving Reebok’s integrity, innovation and values,” including its brick-and-mortar presence.
The announcement of the Reebok acquisition comes as ABG prepares to go public in a $10 billion initial public offering (IPO) after a series of high-profile acquisitions over the past several months. In May, Authentic Brands added Eddie Bauer to its SPARC portfolio, jointly owned with Simon Property Group; a month later, the company added the Izod, Van Heusen, Arrow and Geoffrey Beene labels through a deal with PVH Corp.
Salter said in Authentic’s IPO filing that he intends for the company to continue evaluating new deals “with creativity and discipline,” as the company is in the “early innings” of its global growth strategy. “The way we look at the world, there is $13 trillion of branded commerce in our sights,” he said.