Adidas has formally completed the divestment of Reebok to Authentic Brands Group (ABG) on Feb. 28, 2022. On a transitional basis, the company announced that it would continue to operate the business on behalf of ABG in several markets. Subsequently, the Reebok business will be fully transferred to ABG’s operating partners through a series of local closings that will take place at a later date. These local closings are scheduled for later in 2022 and early 2023.
Under the final agreement signed in August 2021 and as a result of the formal closing of the divestment, Adidas said it has received the majority of the total purchase price of up to €2.1 billion in cash. The remaining payment consists of a consideration to be received later and of a contingent consideration.
As already announced, Adidas intends to return part of the proceeds from the Reebok divestment to its shareholders. Thus, from mid-March until the end of the third quarter of 2022, the group intends to buy back shares up to the volume of €1.5 billion. This is in addition to a current program that provides for the buyback of shares for up to €4 billion by 2025. The first tranche of the latter was launched on Jan. 10 and completed on Feb. 22, 2022. During this period, the company bought back 4,156,558 shares worth a total of €1 billion, representing an average purchase price of €240.58 per share.
ABG meanwhile launched a new collaboration with Foot Locker. The retail chain will expand its Reebok range and carry some exclusive products from the brand from October 2022. In addition, the new owners of Reebok appointed Milan-based luxury fashion manufacturing and distribution holding company New Guards Group as its operating partner for the brand in Europe.
New Guards, which is owned by U.K.-based international e-commerce company Farfetch Limited, will operate retail stores and e-commerce for Reebok, as well as drive wholesale distribution for the brand. It will also work closely with Reebok Design Group (RDG) to develop ”a unified brand language and vision.” Reebok’s previous creative director, Kerby Jean-Raymond, left the company on March 1. Apparently, this is also intended to make the brand fit for cooperation in new segments. New Guards announced it would distribute premium Reebok products also to leading fashion and specialty retailers in more than 50 countries, not only in Europe but also in North America.
