Authentic Brands Group announced its plans to purchase Reebok for $2.46 billion in August, and ABG CEO Jamie Salter expects its revenue to grow from $4 billion to $10 billion within five years.
Salter told Axios the sportswear brand will “focus very big on the classic entertainment fashion side and the other 50% on the athletic side” and will let “Reebok be Reebok.”
Adidas sold Reebok for $1.34 billion less than its purchase price of $3.8 billion in 2006.
- From 2006 through 2010, Reebok’s revenue declined from 4.7% of Adidas’ total revenue to 2.6%.
- At the end of 2011, the Federal Trade Commission forced Adidas to pay its customers $25 million for “deceptive marketing tactics.”
- Reebok turned profitable in 2018 and saw sales growth in 2019 until the pandemic contributed to a 22% decline in revenue.
Next Steps
Authentic Brands Group purchased a 55% stake in the Beckhams’ DB Ventures for $271 million earlier this month and is reportedly looking to expand in the kids’ sector.
The company planned to go public in late 2022 at a $10 billion valuation until a private equity offer halted its plans, and now ABG is aiming for an IPO as late as next year.
