Adidas Inks 11-Year Deal With NBA

Athletic-shoe and apparel maker Adidas said Tuesday it signed an 11-year deal with the United States' National Basketball Association that will make the German company the official uniform and apparel provider for the league.

The company also said the deal includes providing uniforms and other products for the Women's National Basketball Association and the NBA Development League starting with the 2006-2007 NBA season.

Adidas-Salomon AG, which has been a marketing partner with the NBA since 2002, said the deal came about as a result of its acquisition last year of Reebok International Ltd. (RBK), which had been the NBA's uniform and apparel provider since 2001.

The value of the deal was not immediately disclosed by Adidas or the NBA, but shares of Adidas rose 2.6 percent to 171.84 euros ($207.90) in Frankfurt trading after it was announced.

The Reebok brand will continue to be a global marketing partner of the NBA and will keep its ability to create NBA-branded footwear.

"As part of the Reebok integration we as a group made this strategic decision, which we believe will significantly help us to immediately increase the visibility of Adidas as a sport performance brand in the U.S.," Adidas Group Chairman and Chief Executive Herbert Hainer said. "In the long term this new 11-year partnership has the power to make the NBA and Adidas synonymous in basketball."

Besides the apparel, Adidas and the NBA will also partner by increasing the number of Adidas products at the NBA Store in New York City. The company said it and the league will create an in-store Adidas-NBA concept shop that will serve as a prototype for future stores worldwide. Adidas will sell NBA products at its retail shops worldwide, including more than 2,000 in China.

"The Adidas brand is recognized for excellence in sports heritage and performance on a global basis," NBA Commissioner David Stern said in a statement. "NBA and Adidas branded apparel and footwear will be available to even more fans around the world continuing our effort to expand the league's accessibility to anywhere fans can dribble a ball or watch a basketball game."

Erich Stamminger, president and CEO of the Adidas brand, called the deal a first step forward into breaking into new markets using the sport of basketball.

Previously, Adidas has been known worldwide for its sponsorship of soccer.

"This partnership deepens our relationship with a sports league that continues to soar in global popularity," Stamminger said. "We are building a foundation on which we can grow the sport of basketball globally."

The announcement came as Adidas executives gathered in London to outline their plans for Reebok. Critics contend that Adidas' $3.8 billion acquisition of Reebok could prove difficult to reap rewards from.

In March, Adidas reported that Reebok's fourth-quarter orders fell 22 percent, coming off a decline in the third quarter before it.

But investors are still warm on Herzogenaurach, Germany-based Adidas, noting its 13 percent increase in global sales to 6.6 billion euros ($7.9 billion) in 2005, while net income rose some 22 percent to 383 million euros ($463.4 million).

With the World Cup in Germany from June 9-July 9, the company is also expected to boost sales of its soccer-related products.

But the company still faces fierce competition from Nike Corp. (NKE), the leader in athletic footwear in the U.S., because it uses prominent NBA players like LeBron James as well as golfer Tiger Woods in its advertising.