The €3.1 billion takeover deal should be completed shortly, possibly by next Tuesday. Earlier this week, the European Commission gave an unconditional nod to the merger, which was first announced last Aug. 2, without requesting any divestitures of assets in spite of the strong market position that Adidas and Reebok enjoy in Germany and other markets. The next day, on Wednesday, Reebok’s shareholders endorsed the takeover at an extraordinary meeting, accepting payment of $59.00 a share.
No details are yet available about the plans being worked out to integrate the two companies, but investors have so far supported the merger, which creates a big counterpoint to Nike’s mighty dominance of the sporting goods market.
The acquisition will be largely financed by a “significantly oversubscribed” $1 billion private placement announced simultaneously with Reebok’s endorsement of the takeover. More than 34 institutional investors participated in the private placement, the biggest ever to have been negotiated by a German company on the institutional U.S. market. The strong demand allowed Bank of America and The Royal Bank of Scotland to obtain relatively low interest rates of between 5.20 and 5.44 percent for the four tranches of the placement depending on the maturities, which range from periods of three to ten years.
