Adidas has taken over full control of its operations in South Korea by buying out the 49 percent stake owned by its partner Hyun Woo Kim in their joint venture, which was already controlled at 51 percent by Adidas. Finalized last week, the move enables Adidas to tighten its grip in South Korea, the brand’s third-largest market in Asia after Japan and China.
Run by Wolfgang Bentheimer, the Adidas business trails behind Nike in South Korea but for the last two years at least it has been growing at double-digit rates. Adidas began to take charge of its own brand in South Korea back in 1996, when it acquired 51 percent of the shares of Jewoo Trading, its former licensee and distributor for the country. It remains to be seen how the Adidas subsidiary will relate to Reebok Korea, the fully owned Reebok subsidiary in the country, which is managed by Michael Conlan.
Adidas has benefited from similar moves in other countries – in some cases only over a period of time. The 1999 split between Adidas and its Japanese distributor, Descente, led the brand to snatch market leadership in the country last year. Further buy-outs over the last five years have considerably accelerated the brand’s growth in Italy, Turkey, Denmark and Portugal. Remaining joint ventures include Finland, Hungary, Greece and Indonesia, although Adidas has stakes of at least 50 percent in all of these operations.
Meanwhile Adidas has extended until 2010 its collaboration agreement with Yohji Yamamoto, the Japanese designer behind the Y-3 range. Launched at the retail level back in 2003, the line reached sales of about €19 million last year, less than 1 percent of Adidas branded sales, but it has turned into a full-fledged business unit with its own distribution network, including 4 single-brand stores and a flagship store in Tokyo. Over the next years Adidas and Yamamoto intend to open more such stores and corners in leading capitals.
