Adidas is selling Reebok to Authentic Brands Group for up to $2.1 billion, less than the company originally paid for it.

The sports fashion brand, which bought Reebok in 2006 for $3.8 billion, intends to share the majority of the cash proceeds to be received upon closing with its shareholders.

“Reebok has been a valued part of adidas, and we are grateful for the contributions the brand and the team behind it have made to our company,” said Kasper Rorsted, chief executive of Adidas. “With this change in ownership, we believe the Reebok brand will be well-positioned for long-term success.”

Rorsted added: “As for adidas, we will continue to focus our efforts on executing our “Own the Game” strategy that will enable us to grow in an attractive industry, gain market share, and create sustainable value for all of our stakeholders.”

When the retailer first bought the company it included Rockport, CCM Hockey and Greg Norman brands, which Adidas later divested for a total consideration of € 0.4 billion.

In 2016 Reebok initiated a turnaround plan called "Muscle Up", which Adidas said was able to “significantly improve” the brand’s growth and profitability prospects.

But last year Reebok sales dropped by 44 per cent in the second quarter, while the brand saw a 7 per cent sales decline in the third quarter to around $488 million.

In March 2021, adidas presented its 2025 “Own the Game” strategy designed to significantly increase sales and profitability and gain market share by 2025.

The company said that it assessed strategic alternatives for Reebok with a focus on ensuring both adidas and Reebok would be well positioned for sustainable growth.

Following this evaluation, in February the company said it wants to focus on “strengthening” the adidas brand in the global sporting goods market.

“It’s an honour to be entrusted with carrying Reebok’s legacy forward,” said Jamie Salter, founder, chairman, chief executive of ABG. “This is an important milestone for ABG, and we are committed to preserving Reebok’s integrity, innovation, and values - including its presence in bricks and mortar. We look forward to working closely with the Reebok team to build on the brand’s success.”

Adidas said that the sale has no impact on its financial outlook for the current year or its 2025 financial ambition.

Adidas said that it expects the transaction to complete in the first quarter of next year.

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