While savoring the company's performance for the third quarter, the Adidas Group's chief executive, Herbert Hainer, had to brave questions about the turbulence at Fifa and the German football federation (DFB), which are both Adidas partners.
Hainer said in a conference call that the uptick in Adidas' sales indicated that consumers clearly made the distinction between the brand and the uninspiring situation at Fifa. Adidas has refused to join four other sponsors in calling for the dismissal of Sepp Blatter, the organization's president, but Hainer noted that the company had called for reforms even before the World Cup in Brazil last year.
As previously reported, the issue at the DFB focuses on allegations published by Der Spiegel last month that Robert Louis-Dreyfus, the late former key shareholder and chief executive of Adidas, contributed to a slush fund that was meant to buy votes for Germany's bid to host the World Cup in 2006. The organizing committee for the World Cup then allegedly paid €6.7 million to Fifa, which then reimbursed Louis-Dreyfus. Hainer reiterated that the Adidas group had nothing to do with this alleged transaction, which occurred when Louis-Dreyfus was no longer at the company. Any loan to the DFB would have been made with private funds. Hainer added that he expected the German federation to do all it could to clear up the matter.
The Frankfurt prosecutor's office said it had opened an investigation on the suspicion of tax evasion around the awarding of the World Cup and the transfer of €6.7 million from the World Cup organizing committee to Fifa. German police raided the head office of the DFB last week. The federation said it supported the investigation and emphasized that the organization itself was not involved. Wolfgang Niersbach, who resigned yesterday as president of the DFB, was reportedly identified as one of three people involved in the investigation, but he said that the decision to let Germany host the 2006 World Cup six years before the tournament was fair and legal. Both Niesbach and Franz Beckenbauer, president of the organizing committee, stated that no votes had been bought.
The unrest around the 2006 World Cup comes as the end of the ten-year partnership between Adidas and the DFB is nearing, in 2018. Adidas was hoping to round off negotiations for a continuation of the partnership in the first half of 2016 but Hainer acknowledged that the DFB was currently otherwise engaged, adding that there was no time pressure to finalize an agreement.
