Adidas said it plans to sell some of its Yeezy sneakers and merchandise from its former partnership with Kanye West and donate a portion of the proceeds to charity.
The German sportswear giant has been in a tough spot on Yeezy stock after cutting ties with West over his anti-Semitic comments late last year.
Millions of Yeezy-branded shoes with a retail value of 1.2bn euros (£1.05bn) are in storage after their sale was suspended – their value on the resale market skyrocketing after the discontinuation of production, some models having more than doubled in price.
THE debacle on the rapper, now known as Ye, contributed to the company’s first annual loss in more than three decades.
Adidas chief executive Bjoern Gulden said burning the merchandise “wouldn’t be a solution” and said the company was trying to sell some of the merchandise “over time”, adding that profits would be donated to international organizations that West had hurt with his comments.
Adidas, which has come under fire for not acting sooner on Ye’s remarks, was one of a series of companies that cut ties with the 45-year-old after making anti-Semitic comments on social networks.
The Yeezy trainers have been a big hit for the company and are highly sought after on the second-hand market, regularly selling for hundreds of pounds.
Mr Gulden told the company’s annual meeting of shareholders that it had not yet been determined when and how the planned sale would take place.
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He said the company decided not to give away the sneakers to prevent them from reaching the market through the backdoor.
Adidas shares rose 2% after the meeting.
By selling part of the shares, the company is potentially minimizing a $700m (£559m) loss this year, but it’s unclear how
how many shares will be sold and what proportion of the proceeds will be returned.
If the goods are sold, Ye will be entitled to previously agreed commissions – 15% of turnover, according to media reports.
Mr Gulden defended Adidas’ longtime collaboration with the rapper, saying “as tough as he is, he is perhaps the most creative mind in our industry”.