Adidas to buy back up to $3.7 billion of its shares

Adidas plans to buy back up to 3 billion euros ($3.72 billion or 2.66 billion pounds) of its shares by May 11, 2021, including up to 1 billion euros this year, it said on Tuesday.

The German sportswear company, which has a market capitalisation of about 35 billion euros, said it ‍intends to cancel the vast majority of the repurchased shares and will finance the buyback with its current net cash and expects strong cash flow in coming years.

After a strong performance in 2016, Adidas shares have sagged in recent months after disappointing third-quarter results, trading at a discount to rival Nike despite stronger sales growth. It reports fourth-quarter results on Wednesday.

Adidas said in a statement that the ‍new buyback is in addition to company's policy to pay a dividend in the range of 30-50 percent of net income from continuing operations.