Adidas said it would end its collaboration with Kanye West, and Gap announced it would pull clothes he helped design from its stores, after a series of scandals that included an outburst of anti-Semitic remarks from the musician and fashion brand executive.
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Adidas’ decision, which ends a lucrative deal that produced the popular Yeezy shoe collection, was announced after several weeks of pressure on the German sportswear company from human rights activists, and after other companies that had business ties with West, who calls himself “Ye” ( Ye) These days, they stopped working together with him.
Yeezy shoes, the collaboration between Kanye West and Adidas / Photo: Associated Press, Seth Wenig
Gap, which ended its relationship with West in September but still continued to sell items it had already produced, announced yesterday (Tuesday) that it was pulling all Yeezy Gap products from its stores, and closed a website where hoodies and other products born from the collaboration could still be bought the action
“Our former partner’s statements and his behavior continue to highlight why Gap ended the partnership,” the company said in a statement.
West and his representatives did not immediately respond to requests for comment. West has publicly complained about Adidas and Gap, accusing the companies of stealing his designs and breaking promises to expand his business initiatives. He said he was instrumental in Adidas’ success. “I can say anti-Semitic things, and Adidas can’t fire me. Now what?” he said on a podcast that aired earlier this month.
In early October, West appeared at a fashion show for his Yzy brand in Paris wearing a shirt that read “White Lives Matter,” a slogan often heard by white supremacist groups, and a week later wrote in a rambling tweet that he intended to “be on alert for an attack on the Jewish people.” “.
“Unacceptable statements”
Film and television studio MRC and fashion brand Balenciaga were among the companies that walked away from West in recent weeks. Talent agency CAA dropped West from their client list, a person familiar with the matter said.
On October 6, Adidas put its partnership with West to the test. A few days later, Twitter and Meta platforms blocked his accounts after he posted anti-Semitic posts.
Adidas announced yesterday that West’s recent statements and actions were “unacceptable, hateful and dangerous, and they violate the company’s values of diversity and inclusiveness, mutual respect and fairness.”
The end of the relationship adds more pressure on Adidas, which is struggling to grow in China, the largest footwear and clothing market in the world. Adidas is also in the midst of a search for a new CEO, after unexpectedly announcing in August that its current leader, Kasper Rorsted, would retire next year.
“Ending the collaboration with Kanye West is understandable and necessary. From a financial point of view, it’s a heavy blow,” said Ingo Speich, director of sustainability and corporate governance at the fund management company Deka Investment, which owns 0.7% of Adidas. “It remains to be hoped that other collaborations will not be lost.”
Adidas said that it will end the collaboration immediately, stop producing products under the Yeezy brand and stop all payments to West and his companies. The price of the decision in the short term is expected to reach 250 million euros, about 247 million dollars, from the company’s net income in 2022, Adidas said.
Adidas shares fell by more than 3% yesterday in Frankfurt trading. They dropped by more than 60% this year.
Over the weekend, protesters in Los Angeles held a sign over a major freeway expressing support for West’s remarks. “Kenya is right about the Jews,” it says.
Christian supports the Jews
After a photo of the incident circulated on social media, a chorus of celebrities condemned anti-Semitism in online posts, including Kim Kardashian, who filed for divorce from West in 2021.
“Hate speech is never okay, and unforgivable,” Kardashian wrote on Twitter on Monday this week. “I stand by the Jewish community and call for the terrible violence and hateful rhetoric towards them to stop immediately.”
Human rights activists have criticized Adidas in recent days regarding its continued engagement with West. Yesterday, the Central Council of Jews in Germany called on the company to end its cooperation with it.
“As a German company, I simply expect Adidas to have a clear position when it comes to anti-Semitism,” the organization’s president, Dr. Josef Schuster, wrote on Twitter. “Interests of business entrepreneurship should not be a top priority here.”
The CEO of the American organization Anti-Defamation League, Jonathan Greenblatt, wrote on Twitter yesterday (Monday): “Your silence is dangerous for the Jews”, referring to Adidas.
Yesterday, Adidas stated that it “does not tolerate anti-Semitism and any other type of hate speech”.
About 8% of all sales
West’s initiatives in the field of sports shoes began as early as 2006, when he collaborated with Adidas on a shoe that was never produced. A year later, the rapper began working with Nike, eventually releasing the Nike Air Yeezy II, which included the famous Red October model. The partnership with Nike ended in 2013.
Items that West co-designed with Adidas were first introduced in 2015, and the parties entered into a long-term partnership a year later.
As part of the agreement, West gave Adidas the Yeezy brand in exchange for royalties amounting to approximately 15% of Yeezy product sales. Adidas designs and manufactures the products, and the designs remain its property, people familiar with the agreement said.
As far as Adidas is concerned, the agreement was successful. The sales resulting from it accounted for about 8% of the company’s total sales, as analysts at UBS wrote in a report from last week.
Without the agreement, the company’s annual sales would have grown by only 1% on average since 2017 compared to the real sales growth of 3%, UBS estimates. Adidas said that the partnership with Yeezy was one of the most successful collaborations in the industry.
But in recent months, West has begun criticizing Adidas, as well as Gap, on social media. Gap decided to end its engagement with West last month, saying the company and West were “disagreeing” about how they should work together, the Wall Street Journal reported.
Earlier this month, Adidas announced that it had made repeated attempts to personally resolve the disputes with West.
The exit from West adds pressure to the sportswear maker, a few days after it cut its profit guidance for the year, citing a weaker business environment in China as well as significant inventory build-up as a result of low consumer demand in key Western markets. Other factors, such as the suspension of operations in Russia and problems in supply chains that damaged business in many countries around the world, combined to damage the company’s performance in the recent period.
On Thursday, Adidas announced that it now expects its currency-neutral revenue to grow by a few percentage points in 2022 – down from an earlier forecast.