The Adidas - Reebok Merger (Page 2)

Abstract

The case discusses the proposed merger of Reebok International Limited with Adidas-Salomon AG. It describes the recent trends and studies the ongoing merger in the sporting goods industry. The case presents the rationale behind the decision to merge. Finally, the case ends with a debate on whether the merger would be successful.


<<Previous Page

BACKGROUND NOTE

Adidas

The story of Adidas dates back to the year 1920 when Adolf Dassler (Adi) produced a handmade shoe fitted with black spikes. On July 01, 1924, Adi and his brother Rudolf Dassler (Rudolf) started a company under the name "Dassler Brothers OHG".

In the year 1927, the company enhanced its capacity by taking on a new factory on lease. The company's shoes made their debut at the 1928 Olympics in Amsterdam. In 1930, the brothers purchased the factory and named it "Dassler Brothers Sports Shoe Factory."The company introduced tennis shoes in 1931. In the year 1935, the turnover of the company exceeded 400,000 Reichsmark.

In 1938, a second production facility was bought in Herzogenaurach, Germany. In 1948, the brothers decided to part ways. By August 18, 1949, Adidas was registered as a company -'Adi' from Adolf and 'Das' from Dassler. Adi registered the "Three Stripes"as his official logo (Refer Exhibit II).

Business Strategy | Case Study in Management, Operations, Strategies, Business Strategy, Case Studies

Rudolf set up another sporting goods company named Puma. In 1956, Adi's son Horst Dassler (Horst) promoted Adidas strongly during the Olympic Games at Melbourne. He also signed a licensing agreement with the Norwegian Shoe factory, located in Gjovik, Norway. In 1959, Horst was assigned the job of establishing production facilities in France. A factory in Schweinfeld, Germany was started in the same year. In 1960, Adidas was the dominant brand at the Olympic Games held in Rome; 75% of the track and field athletes used Adidas shoes. Adidas stepped into the production of apparel and balls (soccer balls, basketball balls) in 1961and started manufacturing track suits in 1962...

More...

THE SPORTING GOODS INDUSTRY

TABLE I COMPARATIVE POSITION IN 2004

THE MERGER

THE SYNERGIES

TABLE II GEOGRAPHIC SALES COMPARISON OF ADIDAS AND REEBOK FOR 2004

INTEGRATION ISSUES

THE TRACK AHEAD

QUESTIONS FOR DISCUSSION

EXHIBIT I - SHARE PRICE MOVEMENT OF ADIDAS-SALOMON AG, AUGUST 2005

EXHIBIT II - THE THREE STIPES LOGO OF ADIDAS

EXHIBIT III - PRODUCT PROFILE OF ADIDAS-SALOMON AG

EXHIBIT IV - FINANCIAL SUMMARY OF ADIDAS

EXHIBIT V - FINANCIAL SUMMARY OF REEBOK

EXHIBIT VI - PRODUCT PROFILE OF REEBOK INTERNATIONAL LIMITED

EXHIBIT VII - CORPORATE MISSION OF ADIDAS

EXHIBIT VIII - FINANCIAL SUMMARY OF NIKE

EXHIBIT IX - TOP SPONSORSHIP DEALS OF ADIDAS, REEBOK AND NIKE

EXHIBIT X - THE SWOOSH LOGO OF NIKE

ADDITIONAL READINGS & REFERENCES

        Case Code   BSTR177
   Case Length    
20 Pages
              Period    1997-2005
 Organization    
Reebok International Limited
        Pub Date     2005
Teaching Note    Not Available
     
Countries    US, Germany
Industry  Footwear and Apparel

Issues

• The recent trends and structure facing the sporting goods industry.

•  The reasons for the ongoing mergers and acquisitions in the industry and its future.

•The rationale behind the Adidas and Reebok merger.

• Whether the merger will be successful in the long-term.

Keywords

Adidas-Salomon AG, Reebok International Limited, Nike International Inc., Mergers and Acquisitions (M&As), US Federal Trade Commission, Financial Performance, Bargaining Power, Distribution Network, Integration Issues, Footwear and apparel market, Interbrand, Ries and Ries Consulting, Merged entity, Market Capitalization, Synergies, Herbert Hainer and Paul Fireman.

Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

    Business, Strategy & Management Case Studies | Business Strategy Case Studies | Case Study on D&B's ‘Blueprint for Growth'Strategy

     To download this case (No.          BSTR177 ) click on the button  
     below, and select the case  
     from the list of available
     cases:

       Business Ethics Case Studies | Case Study in Management, Operations, Strategies, Business Ethics, Case Studies

       » Case Studies Collection

       » ICMR Home    

         »How To Order   

      Prices:

     For delivery in Electronic
     Format: Rs. 400 (Approx. 9.3$/
     5.3 £ /8.0 €)

     For delivery through courier
       (within India) : Rs. 175

View Detailed Pricing Info
    
      


 
Custom Search