Five months after Adidas announced plans to sell its Boston-based Reebok brand for around $2.5 billion, the sportswear maker will lay off around 150 people before finding a new owner.
A Reebok spokesperson confirmed the number of layoffs via email and said the “majority” of the cuts would affect Massachusetts employees.
Reebok President Matt O’Toole informed employees of the layoffs during a Zoom meeting on Jan. 19, according to a person with knowledge of the matter. O’Toole said they would go into effect at the end of February, when the company is set to be acquired by Authentic Brands Group of New York, a company that helps apparel, athletics and entertainment companies sell their products.
“It goes without saying that today was a tough day,” O’Toole wrote in an email to employees shared with the Boston Globe. “And knowing that day was coming doesn’t make reality any easier.”
O’Toole said layoffs are needed to support an “entirely different operating model” under Authentic Brands. He stressed that the company wanted to communicate the news to employees “as soon as possible”.
Adidas’ Reebok sale to Authentic Brands is scheduled for February 28. Representatives of the companies did not respond to requests for comment.
About 4,200 people work at Reebok, including 600 based in Boston.
Adidas, the German sportswear giant, began considering getting rid of Reebok last February after 15 years of trying to turn around its former competitor. Adidas announced the sale to Authentic Brands – a conglomerate whose brand portfolio includes Eddie Bauer, Forever 21 and Nine West – in August. At the time, some Reebok employees suspected layoffs could occur as part of the ownership transition, the person familiar with the matter said.
Despite the job cuts, Authentic Brands is already making plans for Reebok to grow. She has signed deals in several countries to handle Reebok sales and has also signed an agreement with a major retailer to expand Reebok’s presence in North America and Europe starting in the fall.
Reebok’s global operations will remain based at its Boston headquarters following the acquisition, and O’Toole and Todd Krinsky, senior vice president of Reebok, will continue to lead this group.
SPARC Group – a joint venture between Authentic Brands and Simon Property Group – will license and operate Reebok in the United States and will also oversee the new Boston hub, or “Reebok Design Group”. Jamie Salter, chief executive of Authentic Brands, said in a recent press release that he wanted to keep Reebok’s global operations in Boston to “preserve and nurture the brand’s heartbeat and unmistakable DNA.”
Anissa Gardizy can be reached at [email protected]. Follow her on Twitter @anissagardizy8.