The New York Times is reporting that Adidas-Salomon AG will buy Reebok International LTD for 3.8 billion worth in cash and stock.
The deal sees Reebok paying $59 a share for all outstanding Reebok shares a 34% premium. While the deal still has to hold up to shareholder, and regulatory approval from the US and EU, it looks like Nike will have stronger competition in the form of this combined company.
Recently Adidas and Reebok have approached the sneaker market with a celebrity focused ad campaign Adidas with Missy Elliot, Reebok with 50 Cent and Jay Z.
Adidas posted a 30% percent gain in second-quarter net profit and improved sales. Meanwhile over at Reebok, second quarter profits jumped 71% on the strength of a new marketing campaign.