By Scott Kanowsky
Investing.com -- Adidas AG (ETR:ADSGN) has confirmed that it has ended its partnership with Kanye West due to a recent string of controversial comments and actions made by the rapper and artist.
In a statement, the German sportswear brand said it would terminate its dealings with Ye, as West is now known, immediately. It will halt production of any of its Yeezy-branded products, as well as cease payments to Ye and his companies.
"adidas will stop the adidas Yeezy business with immediate effect," the Herzogenaurach-based firm said, adding that it will have a negative impact of up to 250M euros on the company's net income in 2022. Yeezy had generated around 1.5B euros annually in sales for Adidas, or about 7% of its total revenue, according to recent figures from Telsey Advisory Group cited by Reuters.
Shares in Adidas, which also cut its annual forecast last week, fell sharply in late afternoon European trading. They have dropped by more than 20% over the past month as controversy swirled around its relationship with Ye.
The decision comes after Ye published several outbursts on social media that were widely condemned for being anti-Semitic. His accounts on Instagram and Twitter were suspended.
Ye also wore clothing at a Paris fashion show that included a slogan that has been identified by the Anti-Defamation League as hate speech.
Meanwhile, Ye has accused Adidas of stealing his design ideas. In its statement, the group said it is the "sole owner" of all design rights to existing products.
Earlier in October, Adidas had said that it would put its ties to Ye - which it once hailed as the "most significant partnership created between a non-athlete and sports brand" - under review.
Other companies that had been collaborating with Ye have also reportedly stopped doing business with him, including retailer Gap (NYSE:GPS) and fashion house Balenciaga.