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adidas AG announced this week that it had completed  a € 400 million convertible bond, issuing 15,684,274 new shares in exchange for the debt. The deal will effectively reduce adidas’s net debt by € 400 million and increase equity by that amount. Management has set a goal of reducing its financial leverage below 50 percent by the end of the year - a strong play in a soft market.

According to adidas: “This development corresponds to Management’s original expectation that, in light of the current adidas AG share price, most or all bondholders would exercise their conversion rights. The new shares will be entitled to dividends as of the beginning of the financial year 2009.”