German apparel company Adidas is preparing to offload its struggling Reebok brand, the firm announced Tuesday.
Adidas acquired Reebok in 2006 for roughly $3.8 billion in an attempt to better compete with Nike, but the brand has posted disappointing sales figures in recent years. Adidas said Tuesday that it has begun a formal process to divest from Reebok, pivoting to focus on its core brand.
“After careful consideration, we have come to the conclusion that Reebok and adidas will be able to significantly better realize their growth potential independently of each other,” Adidas CEO Kasper Rorsted said in a statement. “We will work diligently in the coming months to ensure a successful future for the Reebok brand and the team behind it.”
Adidas did not specify the reason for the move, nor did it say whether it would look to spin Reebok off into an independent company or look to sell it outright. The firm said Tuesday it has developed a new five-year strategy that involves “further strengthening the leading position of the Adidas brand in the global sporting goods market.”