Adidas Ends Partnership With Ye Immediately; Stock Down

(RTTNews) - German sports sneaker and apparel maker Adidas AG announced Tuesday that it terminated its partnership with American rapper Kanye West, who now goes by the name Ye, with immediate effect, citing his recent offensive behaviour.

Adidas expects the decision to result in a short-term negative impact of up to 250 million euros on its fiscal 2022 net income due to the high seasonality of the fourth quarter.

Earlier in the day, Blommberg reported, citing people familiar with the matter, that the company was planning to announce such a decision. Following the news, Adidas shares were trading down in the German market. The shares are now trading at 99.77 euros, down 4 percent.

In a statement, the company said it has decided to end production of Yeezy branded products and stop all payments to Ye and his companies. adidas will stop the adidas Yeezy business with immediate effect.

adidas stated that it is the sole owner of all design rights to existing products as well as previous and new colorways under the partnership.

The company said in a statement, "adidas does not tolerate antisemitism and any other sort of hate speech. Ye's recent comments and actions have been unacceptable, hateful and dangerous, and they violate the company's values of diversity and inclusion, mutual respect and fairness. After a thorough review, the company has taken the decision to terminate the partnership with Ye immediately."

The company plans to provide further details as part of its upcoming third-quarter earnings announcement on November 9.

In recent weeks, the rapper made controversial statements, including anti-Semitic social media posts.

On October 6, the company said it was reviewing its business partnership with the rapper due to his public criticizing of the company and its CEO Kasper Rørsted.

Adidas had announced its partnership with West in 2013. The rapper and the German company in 2016 announced an extension of the deal and the launch of a new Yeezy category.

In recent times, West accused the sportswear brand of not giving him enough control over the line. In June, West shared an image of Adidas' recently released Adilette 22 slide sandals in Instagram, and accused the company of copying his Yeezy Designs.

Later, the rapper's Twitter and Instagram accounts were restricted, and the social media platforms said they removed his posts that online users condemned as anti-Semitic.