The Salomon family, which still owns 38.9% of the share capital and 56.1% of the voting rights through holding company Sport Developpement S.C.A., has agreed to the bid. Other shareholders will be asked to vote in the next few weeks. The deal also has to be approved by competition authorities.
If the acquisition goes through, the group will be renamed Adidas-Salomon. Adidas and Salomon officials were unavailable at press time to comment on future ad agency arrangements. Currently, Adidas uses Leagas Delaney, London, and Salomon employs both Jump, a BDDP affiliate, and BBDO affiliate Proximite. However, Salomon's advertising is not high profile.
Salomon, based in Annecy in the French Alps, began as a ski-binding producer but is now the world leader in winter sports equipment, including skis and boots for both Alpine and cross-country sports. In 1996, it achieved profits of $33.6m on sales of $733m.
In the past five years, it has diversified into summer sports equipment, with brands such as Taylor Made (golf) and Mavic bicycles. It retains the Salomon brand for use on its winter sports goods, however.
Growth is expected to come from the launch of new products such as in-line skates and snowboards. In February next year, a new generation of in-line skates will launch under the Adidas-Salomon name.
"This acquisition is an important step in our goal to offer the best sport brand portfolio in the world," says Adidas Chairman Robert Louis-Dreyfus.
Jean-Francois Gautier remains CEO of Salomon, which will continue to be managed as an independent company, and he becomes a member of the board. "This acquisition offers long-lasting chances for Salomon shareholders, employees and partners," he says.
Adidas made profits of $196m last year on sales of $2.93bn. The company is offering $87 per Salomon share, some 15% higher than the average share price during the past three months.
Copyright September 1997, Crain Communications Inc.