Adidas Announces Share Buyback Program
German sportswear giant, Adidas, plans to spend nearly $5 billion under its new share buyback program, just months after the company spent another $1.1 billion buying back its stock units.
The company plans to return the proceeds from the program to its shareholders, along with the majority of cash raised from the sale of Reebok to Authentic Brands Group.
“Strong shareholder returns are a key component of Adidas’ new strategy ‘Own the Game.’ As part of ‘Own the Game,’ Adidas plans to generate substantial free cash flow until 2025 and return the majority of it — between 8 billion and 9 billion euros — to its shareholders via dividend payments and share buybacks,” the company said.
Adidas added that it will cancel the bulk of the repurchased shares, which will result in a reduction of the number of shares and share capital.
The launch of the new share buyback program is part of the company’s effort to return slightly more than $10 billion to its shareholders over a five-year period through dividend payouts between 30% to 50% of the company’s net income.
The new program is expected to launch in January 2022 and will extend till 2025.
“We will hit the road running in 2022: Driven by strong top-and bottom-line improvements, we will once again generate a high free cash flow, which we will almost entirely return to our shareholders next year,” the company’s CFO Harm Ohlmeyer said.
Originally published at https://retailbum.com on December 20, 2021.
