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ADIDAS "OUTMANEUVERED" NIKE WITH PURCHASE OF SALOMON
Published September 22, 1997
In the wake of adidas' $1.3B purchase of Salomon, adidas and Nike "are squaring off to see which will dominate the sporting-goods market in the next century," according to Woodruff & Trinephi of BUSINESS WEEK. adidas CEO Robert Louis-Dreyfus "has outmaneuvered Nike in the rush to diversify from shoes and apparel -- a crucial strategy that may push Nike to look for more acquisitions. ... Salomon's product line gives Adidas a new edge. The company makes finely engineered products that command premium prices and deliver higher margins than T-shirts or sneakers. They also attract attention from upscale consumers." Woodruff & Trinephi add that Salomon's bindings "are the industry standard for both downhill and cross-country skis," and that one-fourth of adidas-Salomon's sales "will come from such high-margin products" (BUSINESS WEEK, 9/29 issue).