Adidas to refocus on Reebok brand after Indian fraud
08 March 2013
German sportswear maker Adidas AG said on Thursday it will not abandon the troubled Reebok brand and will seek to revive it, even as the group increased the amount set aside against the hit it took due to financial irregularity in Reebok India to almost 70 per cent more than it previously estimated.
Adidas said the fraud in India in 2011 made a dent of €211 million, about Rs1,500 crore, in its balance sheet for that year, much more than its last year's estimate of €125 million.
"As unpleasant as the identified irregularities at Reebok India Co are, I am satisfied we have diligently completed our efforts to uncover all the wrongdoings, while simultaneously laying the foundation for a healthy and profitable business for Reebok in India in the future," Herbert Hainer, chief executive of Adidas Group, said in a statement.
"We are fully committed to India for both of our brands (Adidas and Reebok)," he added.
Reebok India is currently seeking to revive its lost fortune with a new head for the country and has closed one-third of its 800-odd stores nationwide.
Currently Adidas has 500 Reebok stores and about 630 Adidas outlets in the country.