Sports apparel and footwear company Adidas has confirmed it has been given approval for a syndicated €3 billion government-backed loan to mitigate the financial impact from the spread of COVID-19.
Adidas also confirmed on Tuesday that it was suspending dividends, share buybacks and 2020 executive bonuses as a condition of getting the loan, citing the need “to bridge this unprecedented situation.”
The loan, which will be priced in line with market conditions, comprises a loan commitment of €2.4 billion from KfW and €600 million in loan commitments from a consortium including UniCredit, Bank of America, Citibank, HSBC and Standard Chartered Bank.
Adidas also said it was still unable to provide an outlook for the full year 2020 and that publication of first quarter results would be on 27 April 2020, with the company concluding: “The further development of the coronavirus outbreak and its impact on the company’s business cannot be predicted at this point in time."
Earlier this month, Adidas announced it will suspend a €1 billion share buyback it had planned for this year in order to conserve cash after shuttering its retail outlets in Europe and North America.
In a statement, Adidas said: “Considering the high level of economic uncertainty caused by the dynamic developments related to the coronavirus outbreak, the Adidas Executive Board decided to proactively adopt a conservative approach to liquidity management.”