<p>German sportswear maker Adidas AG plans to sell or spin-off its underperforming Reebok brand, 15 years after it bought the U.S. fitness label to help compete with arch-rival Nike Inc.</p>.<p>Adidas said on Tuesday it had decided to begin a formal process aimed at divesting Reebok as part of a five-year strategy it plans to present on March 10, when the company will also publish 2020 results. It will report Reebok as a discontinued operation from the first quarter of 2021.</p>.<p>A banking source said the business could be worth around 1 billion euros ($1.2 billion).</p>.<p>"Reebok and Adidas will be able to significantly better realize their growth potential independently of each other," Chief Executive Kasper Rorsted said in a statement .</p>.<p>The company bought Boston-based Reebok for $3.8 billion in 2006, but its sluggish performance led to repeated calls from investors to dispose of the brand.</p>.<p>In the meantime, Adidas managed to eat into Nike's dominance in the United States with its core brand, helped by partnership with celebrities like Kanye West, Beyonce and Pharrell Williams.</p>.<p>After Rorsted took over as CEO in 2016, he launched a turnaround plan for Reebok, which helped it return to profitability, but its performance continued to lag that of the core Adidas brand and it was then hit by the Covid-19 pandemic.</p>.<p>Reebok's net sales fell 7% in the third quarter of 2020 to 403 million euros ($488 million), after falling as much as 44% the preceding quarter. In 2019, Adidas wrote down Reebok's book value by nearly half, compared with 2018, to 842 million euros.</p>.<p>Options for Adidas include spinning Reebok off as a stand-alone public company, or selling the brand to private equity, another major sports retailer or a multibrand player like VF Corp.</p>.<p>Reebok's recent collaborations with celebrities like Cardi B and a refreshed focus on women's apparel have put the brand in a better place, analysts say.</p>.<p>Adidas said in November it was expecting a drop in overall sales for the end of 2020 as the reimposition of lockdowns in Europe offset a return to growth in China and strong demand for running gear and products designed by Beyonce.</p>
<p>German sportswear maker Adidas AG plans to sell or spin-off its underperforming Reebok brand, 15 years after it bought the U.S. fitness label to help compete with arch-rival Nike Inc.</p>.<p>Adidas said on Tuesday it had decided to begin a formal process aimed at divesting Reebok as part of a five-year strategy it plans to present on March 10, when the company will also publish 2020 results. It will report Reebok as a discontinued operation from the first quarter of 2021.</p>.<p>A banking source said the business could be worth around 1 billion euros ($1.2 billion).</p>.<p>"Reebok and Adidas will be able to significantly better realize their growth potential independently of each other," Chief Executive Kasper Rorsted said in a statement .</p>.<p>The company bought Boston-based Reebok for $3.8 billion in 2006, but its sluggish performance led to repeated calls from investors to dispose of the brand.</p>.<p>In the meantime, Adidas managed to eat into Nike's dominance in the United States with its core brand, helped by partnership with celebrities like Kanye West, Beyonce and Pharrell Williams.</p>.<p>After Rorsted took over as CEO in 2016, he launched a turnaround plan for Reebok, which helped it return to profitability, but its performance continued to lag that of the core Adidas brand and it was then hit by the Covid-19 pandemic.</p>.<p>Reebok's net sales fell 7% in the third quarter of 2020 to 403 million euros ($488 million), after falling as much as 44% the preceding quarter. In 2019, Adidas wrote down Reebok's book value by nearly half, compared with 2018, to 842 million euros.</p>.<p>Options for Adidas include spinning Reebok off as a stand-alone public company, or selling the brand to private equity, another major sports retailer or a multibrand player like VF Corp.</p>.<p>Reebok's recent collaborations with celebrities like Cardi B and a refreshed focus on women's apparel have put the brand in a better place, analysts say.</p>.<p>Adidas said in November it was expecting a drop in overall sales for the end of 2020 as the reimposition of lockdowns in Europe offset a return to growth in China and strong demand for running gear and products designed by Beyonce.</p>