Adidas announces €4bn share buyback programme

The executive board of sports fashion brand adidas has announced the launch of a new multi-year share buyback programme.

From January 2022, the company plans to buy back shares in an amount of up to €4 billion until 2025.

Taking into consideration the €1 billion share buyback completed in 2021 already, the company intends to return up to €5 billion to its shareholders through regular share buybacks alone during the five-year strategic cycle.

Adidas said that the buyback activities are complemented by the company’s annual dividend payouts in a range of between 30 per cent and 50 per cent of net income from continuing operations.

It added that 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 and 9 billion – to its shareholders via dividend payments and share buybacks.

In addition, the company plans to return the majority of the cash proceeds from the Reebok divestiture to the shareholders after closing of the transaction, which is expected in the first quarter of 2022.

“Over the next couple of years, our business will become significantly more cash generative than ever before”, said Harm Ohlmeyer, chief financial officer, adidas. “And 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 retailer said that, as with previous share buybacks, adidas intends to cancel most of the shares repurchased during the programme, which would reduce the number of shares as well as the share capital accordingly.

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