Sports goods giant Adidas said that it has entered into a definitive agreement to sell its Rockport business to a new entity formed by Berkshire Partners and New Balance for a total consideration of 280 million dollars, most of which will be paid in cash with the remainder comprised of notes.
According to the company, New Balance will contribute its Drydock business to the new entity which will create a leading collection of global footwear brands including Rockport and Drydock's Aravon, Dunham and Cobb Hill brands. The company expects the transaction to be completed later in 2015.
As a result of the transaction, the Adidas Group will record a non-operational negative P&L impact in a double-digit million Euro amount, which will be reported in discontinued operations as part of the company's 2014 results.
Separately, the company said that it reached its updated top- and bottom-line financial targets on an underlying basis. Full year 2014 net income attributable to shareholders reached the earnings target of around 650 million euros, excluding goodwill impairment losses and the impact of the Rockport divestiture.
Excluding the impact from the divestiture of the Rockport business, currency-neutral Group sales increased by 6 percent in 2014. In euro terms, sales were up 2 percent to 14.8 billion euros, compared to 14.5 billion euros in 2013.
The Group noted that all sales channels contributed to this positive top-line development, with strong double-digit growth in retail. From a brand perspective, adidas sales grew 11 percent currency-neutral for the full year. Reebok recorded its seventh consecutive quarter of growth in the fourth quarter and ended the year with a currency-neutral sales increase of 5 percent. (dpa-AFX)