Wednesday, April 18, 2007

Apax eyes Adidas

Private equity group Apax Partners is believed to be keen to buy a large stake in sporting goods giant Adidas. Such an acquisition could even lead to a full-scale bid for the company. The news follows in the wake of PPR's acquisition of 27 percent of rival Puma. Apax was said to be preparing a tender offer to shareholders of Adidas, at €50 a share, reports the FT. The private equity firm is looking to acquire 25 percent of the company, which is valued at over €9 billion.
Only recently, Adidas was the subject of takeover rumours when it became apparent that a mysterious suitor was building a stake in the company. When it emerged that billionaire entrepreneur Mike Ashley was acquiring stock under his own name, the unrest settled. Industry experts do not believe he will make a bid for the company, particularly because of its high market capitalisation. Nevertheless, interest in the company has not waned. Rival private equity groups are also said to be eyeing Adidas, although a succesful tender offer from Apax may limit competition. Adidas is attractive to potential bidders because it is still vulnerable after its purchase of Reebok two years ago as it tries to integrate the two businesses. Furthermore, the company employs relatively few people in Germany, leading experts to believe that a takeover attempt from Apax would not be objected to.
Although neither company would comment on the news, a source close to Apax said that the firm was looking to build a stake in the German sporting group. Apax has been on an acquisitive streak in the retail sector. Last year it acquired the Tommy Hilfiger fashion group for $1.6 billion.

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