Adidas to buy Reebok for $3.8 bln
By UsaydFRANKFURT (Reuters) - Germany’s sporting goods maker Adidas-Salomon (ADSG.DE) has agreed to buy U.S. rival Reebok (NYSE:RBK - news) for $3.8 billion in a move to close the gap on Nike and promise a profit increase by expanding in the United States and entering new markets.
Taking Over!
Well what’s going on? Much like the computing world (remember Adobe and Macromedia) and so on, when a relatively sucessful company is not doing as well as its rivals, instead of trying new ways or having ran out of methods of fixing their issues, they seem to do the only thing feesable - Sell out!!
The world’s second- and third-biggest sports goods companies said Wednesday Adidas would buy the outstanding shares of Reebok for $59 per share in cash, a 34 percent premium to Reebok’s closing share price Tuesday.
The combination will create a more formidable competitor to battle Nike’s dominance of the market for athletic gear, particularly in the United States, which accounts for 50 percent of the sports footwear market alone.