Frankfurt, Germany, German sporting goods maker Adidas-Salomon is buying Reebok, its U.S. rival, for $3.8 billion (3.1 billion euro). Adidas is number two in the sporting goods industry behind Nike. Reebok is third. Adidas hopes to close the gap between its sales and Nike’s with the acquisition. Adidas expects its net income to rise at least 10% per year in the medium term, after the Reebok takeover.
Adidas said that Paul Fireman, Reebok chairman and CEO, would continue running the Reebok brand, describing the takeover as friendly. Adidas still needs the approval of Reebok shareholders and antitrust authorities, but the company expects to finalize the deal in the first half of 2006.