Adidas Group completed the sale of Mitchell & Ness, the one-time leader of the retro jersey craze, to a newly formed entity primarily owned by Juggernaut Capital Partners.

The sale ironically comes as the Adidas Brand is finding its strongest growth with its fashion-oriented offerings. These include robust growth for its Originals and Neo labels, momentum around classics such as the Superstar and Stan Smith collections, and an attention-getting star collaboration with Kanye West. But it also comes as the brand has distanced itself from the fan apparel space over the last few years to focus on player endorsements.

Founded as a golf and tennis company in 1904, the Philadelphia-based firm provided on-field uniforms to the Philadelphia Eagles, Athletics, and Phillies as early as 1933. The company shifted course in the 1980’s when then-owner Peter Capolino decided to make replicas of his favorite players’ jerseys. Vintage baseball jerseys of Mickey Mantle and other legends made of flannel became a hit with the boomer crowd.

After the rap group OutKast wore the company’s Houston Astros rainbow jersey from the eighties in a 1998 video, Capolino’s employees convinced him that they could sell to the young urban set. The jerseys, costing $300 to $500 at the time, became de rigueur fashion statements for rappers and athletes. Besides MLB jerseys, vintage NBA uniforms also were a hot item.


The throwback jersey fad faded in the mid-2000’s and Adidas acquired the brand in 2007 to expand its reach into the fan apparel space. At the time, it owned the rights to NFL merchandise through the Reebok brand and the NBA rights through its Adidas brand. At the time of the sale, Mitchell & Ness sold more than 1,600 authentic styles representing player jerseys, warm-ups and heavyweight jackets. The line has expanded over the years to encompass vintage style shirts, caps, sweats and shorts.

While the Adidas brand has since taken over sponsorship of the NHL from Reebok and sponsors Major League Soccer, it has reduced its overall exposure in fan apparel. Nike took over the NFL on-field license in 2012, and Nike will also take over the NBA uniform license beginning with the 2017/18 season.

In a shift, Adidas Group plans for more investments in player endorsements. Earlier this year, Adidas Group set a goal of sponsoring 250 NFL players by 2020, up from 95, plus 100 NBA players, up from approximately 70.

Adidas Group has also narrowed its focus to core brands: Adidas and Reebok. In August 2015, it sold Rockport to Berkshire Partners and New Balance Holding. In May 2016 Adidas Group said it had entered into negotiations regarding the sale of parts of its golf division, which includes TaylorMade, Adams and Ashworth. The company plans to continue with the Adidas golf business.

In a statement, Adidas Group said it achieved its initial closing of Mitchell & Ness, represented the first step to carve out the business from the Adidas Group, which is expected to conclude within the next twelve months through a subsequent second closing.

“The Adidas Group initially acquired Mitchell & Ness in 2007 and has helped revenues to grow almost ten times since the acquisition,” said Herbert Hainer, CEO of the Adidas Group. “This growth is a clear sign that brands within the Adidas Group can flourish due to the Group’s brand and sales know-how, its world-class infrastructure and its partnerships and collaborations. The 2007 acquisition of Mitchell & Ness and the subsequent divestiture generated superior returns to shareholders and represents clear success stories for all other stakeholders involved, including Mitchell & Ness, wholesale and retail customers, the major U.S. sports leagues and numerous other license partners.”

By all indications, Adidas Group made some money in the end on the acquisition.

In late May in announcing the sale agreement, Adidas Group indicated it would record a one-time positive P&L impact at the time of closing. The amount, which is expected to be in the low- to mid-double-digit million euro range, will be reported in other operating income as part of the Group’s net income from continuing operations.

In 2007, Adidas said the purchase price for Mitchell & Ness came to €2 million. The amount consisted of inventories (€1 million), accounts receivable (€1 million), accounts payable (negative €3 million) and other intangible assets (€3 million) based on a purchase price allocation.

As reported, Kevin Wulff, the former president and CEO of Asics America Group, has been recruited to help manage Mitchell & Ness.

“We are pleased to partner with industry veteran Kevin Wulff and the existing Mitchell & Ness management team and employees to build and grow upon the success of the Mitchell & Ness brand, ” added Craig Hille, managing director of Juggernaut Capital Partners.

Juggernaut Capital, headquartered in Washington, D.C., is a PE firm focused on middle-market companies primarily in the consumer and business services sectors with an excess of $725 million in committed capital. Its closest current investment is Amerex Group, a supplier of outerwear and swimwear. It’s other current investments include Advantage, Apollo, Catapult Learning, Ceuta, Continuum Health Alliance, Cranford Pharmaceuticals, Crystal, IBG, Penn Power Group, Trusted Health Plan, True Citrus and Voss.

Photos courtesy Mitchell & Ness