Authentic Brands Group is believed to have terminated its deal with Farfetch-owned New Guards Group (NGG), which had previously been the licensee of Reebok and oversaw the distribution of the sportswear brand in Europe.

According to a memo from NGG Management to staff, seen and reported on by WWD, NGG has received a termination notice for the agreement after Farfetch's owner Coupang had failed to amend “unfavourable economic terms” between NGG and Authentic.

It is understood that NGG owes Authentic royalty payments of an estimated 300 million dollars, and is now being called on to immediately cease operations of the Reebok EU website and sale of the brand’s products.

NGG has been facing an uncertain future in the wake of its parent company Farfetch’s sale to Coupang in 2023, with the South Korean retail giant determined to put its entire focus on the luxury platform over other aspects of the business.

Later, NGG, which owns the likes of Palm Angels, Heron Preston and Ambush, became the centre of speculation earlier this year regarding alleged takeover talks, with Italian private equity firm Style Capital believed to be mulling an acquisition of this group.

Such a deal has not yet materialised, however, and other interested parties have not since made themselves known.

NGG managed to secure the Reebok licensing deal with Authentic shortly after the latter snapped up the sportswear brand from Adidas in 2021. This provided NGG with the rights to operate the brand in Europe, an agreement that encompassed its retail stores, e-commerce and wholesale.

This article was updated 16:35, November 5, 2024, to reflect that NGG management were the ones to issue a memo to staff, aligning with new information that was provided to FashionUnited.