Adidas on Thursday said that it had hired a headhunting firm to begin the search for a successor to Herbert Hainer, who plans to step down as the longest-serving chief executive of a German blue chip company in 2017.
The supervisory board hired an executive search firm to find a replacement for 60-year old Mr. Hainer, Adidas's board's chairman, Igor Landau, said. The announcement comes a few months after Adidas was forced to issue two profit warnings and some investors began calling for a management change.
"This is a long-term process that will be facilitated by an executive search firm,'' Mr. Landau said in a statement.
Adidas disclosed the search after Mr. Hainer sent an email to Adidas employees, confirming a story on the hiring of the headhunter that was first reported in a business magazine, Manager Magazine.
Mr. Landau said the search for a replacement had begun in 2013, and Mr. Hainer's contract had been renewed until 2017 with a successor in mind. But Thursday's acknowledgement was the first explicit public confirmation that a successor would replace Mr. Hainer in two years.
“The supervisory board will now start to look for the best possible candidate for my succession, both inside and outside the Adidas group,” Mr. Hainer said in the note to Adidas employees, which was released to the press on Thursday. “This will be a long-term process that has just begun.”
Marc Opresnik, a professor of marketing and management at SGMI Management Institute St. Gallen in Switzerland, said the announcement of plans for Mr. Hainer's departure was not surprising, after the company's recent financial struggles.
"Recently, Adidas's leadership has been criticized strongly, especially by investors,'' Mr. Opresnik said. "Also, Mr. Hainer's current contract runs only until the end of March 2017.''
Mr. Hainer issued a profit warning in July, the second time in less than two months that he had had to correct Adidas' market guidance.
The two-year extension of Mr. Hainer's contract until 2017 "had the objective to give sufficient time for a smooth transition in order to optimize the process of succession," said Adidas in a statement.
The company, like its smaller German rival Puma, is based in the tiny northern Bavarian town of Herzogenaurach.
Mr. Hainer, who was appointed chief executive at Adidas in 2001, came under criticism last year for failing to close the gap with Nike. He is the longest serving chief executive of a company in Germany's benchmark DAX stock index.
Profit at Adidas fell by 21 percent in the first nine months of 2014 to €630 million from €796 million a year earlier, as the company earned less on the shoes and sportswear and paid to expand its retail sales network. The company in October said sales would rise by 5 to 9 percent during 2014.
Despite its high-profile sponsorship of last year's soccer World Cup in Brazil, Adidas struggled to halt the sales decline in its golf equipment business and weakness in the United States and Russia. The company's stock was the biggest loser among DAX firms during 2014.
"The successor to Mr. Hainer must revive Adidas' golf equipment business and key markets such as the United States and Russia by delivering quick results to restore credibility with investors and employees,'' Mr. Opresnik, the management professor in St. Gallen, said.
Sarah Mewes and Gilbert Kreijger are editors at Handelsblatt Global Edition in Berlin. Kevin O'Brien is editor in chief of Handelsblatt Global Edition. To contact the authors:[email protected], [email protected] and [email protected]