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Photo by Courtesy Manufacturer
Salomon’s headquarters in Annecy, France will remain the center of the brand’s global operations.

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Photo by Courtesy Manufacturer
Salomon’s headquarters in Annecy, France will remain the center of the brand’s global operations.

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Photo by Courtesy Manufacturer
Salomon board bases await their turn in the press inside the brand’s Rumily, France factory.

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FEATURES
Salomon Sold To Amer Sports

By Leah Crane

Posted 08.09.2005

On Monday, May 2, 2005, adidas-Salomon AG sold off the Salomon portion of its business to the Helsinki, Finland-based Amer Sports, making Salomon the latest offering in the rapidly consolidating wintersports market. The deal unravels an eight-year partnership first started when adidas bought Salomon and its brands for 1.5-billion dollars in September 1997.

While Salomon, Mavic, Bonfire, Arc’Teryx, and Cliché brands were all included in the 485-million Euro (627-million dollars) sale in May, Taylor-Made was noticeably absent. When adidas-Salomon stock rose 7.6 percent after the announcement, speculation was rampant that the sale was a quick way for adidas-Salomon to dump the ailing Salomon portion of its business.

However, according to a public statement from adidas-Salomon CEO Herbert Hainer, it’s really about concentrated growth: “Salomon has been a great member of our group. However, we decided that now is the time to focus even more on our core strengths in the athletic footwear and apparel market, as well as our growing golf category. We are convinced that Amer Sports is the ideal partner to take Salomon to the next level.”

Skeptics and naysayers beware. Amer Sports--the current owners of Wilson, Suunto, Precor, and Atomic--also saw its share prices rise after the acquisition agreement was made public. While adidas’ original acquisition of the Salomon brands was positioned as a way to add a winter and equipment balance to the German brand, at Amer Sports the move adds market share to a group already deeply entrenched in that market. “Very rarely do you get to see a triple win out of these kinds of deals,” explains Salomon North American President and CEO James Curleigh, who plans to keep his team’s offices based in Portland, Oregon. “The win for adidas is that it gets to focus on the ’core adidas business. The Amer group gets to achieve its vision of being the leading equipment company in the world, and Salomon gets to partner up with a much smaller, but seemingly more agile, more equipment-focused business group. It’s a huge bonus and will certainly help Salomon out.”

It doesn’t hurt that Amer Sports CEO and President Roger Talermo is a former Salomon executive who worked for different divisions within the brand from 1988 to 1995. “Salomon’s offering fits perfectly with our own portfolio,” he said in a press conference after the acquisition was announced. “The world’s leading brands of Salomon open up great new potential for Amer Sports. In wintersports, Salomon and Amer Sports’ Atomic complement each other very well. Furthermore, the two companies and their brands support each other well in geographical terms, making our geographical coverage more balanced than before.”

Due to synergies in the industrial operations of the wintersports business, administration, and R&D;, Amer is expecting to gradually realize an annualized cost savings of nearly 40-million Euros by the end of 2008. In the interim, the purchase agreement includes a three- to four-year transition period to help ensure Salomon’s smooth separation from the adidas-Salomon organization. The deal is expected to close by September.



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