Saturday, 19 January 2013

Adidas claims ignorance about Reebok India Irregularities


German sportswear maker Adidas said it was ignorant of irregularities at the Reebok India unit in the past few years. It has rejected accusations that it had in any way been aware of the wrongdoing that led to a fraud estimated by it at Rs 870 crores. “The financial irregularities at Reebok India were conducted by the former Reebok India company management, without knowledge or any involvement of the Adidas Group HQ,” the company said in an emailed statement.

Adidas has put the blame for the financial irregularities reported in May 2012 on those running Reebok India at the time—Subhinder Singh Prem, former managing director, and Vishnu Bhagat, former chief operating officer. The company said its Reebok India unit has “petitioned the government to conduct further investigations to unearth the full extent of fraud perpetrated against the company, which has reportedly been ordered in the matter”.

On the other hand, the German sport goods major is finding it tough to make its Reebok store franchisees in India to accept terms of the new business agreement. The discontent among Reebok franchisees runs so deep that many have offered deep discounts, as high as 80 percent, in an effort to clear stocks and settle their accounts with the company.

Adidas further added that it didn’t intend to let the Reebok brand die in India. “We are committed to the Indian market and see great growth potential in the mid and long term. Reebok is a premium global sports brand,” it said. “Our recent as well as future campaigns will focus on strengthening our fitness proposition with consumers in India. It is our clear intention to grow the business of Reebok brand in India focusing on profitability.”
http://www.fashionunited.in/news/apparel/adidas-claims-ignorance-about-reebok-india-irregularities-180120134824

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