Adidas says its acquisition of a garment maker has been approved by the International Trade Commission, as it looks to cut down on manufacturing costs and create new supply chains.
The announcement comes amid a crackdown by European Union antitrust regulators on companies that manufacture garments.
Adidas will buy the fabric-fabric-fabrics-fabrize-clothing-shoes-etc-making company.
Adidas said it will use the proceeds to invest in research and development to improve its manufacturing capabilities.
Adidas’ chairman and chief executive, Richard Hand, said the company plans to use the cash to expand its operations in Asia.
“The Adidas Group is one of the world’s leading manufacturers of apparel, with factories in Shanghai, Shenzhen and Beijing,” Hand said in a statement.
“With the acquisition of fabric-based garment sourcing, Adidas is strengthening our global supply chain and improving its manufacturing operations, including in China.”
The acquisition of the company, known as FabricFabric Group, would give Adidas an opportunity to further expand into apparel manufacturing in Asia, where it accounts for nearly a third of global apparel sales.
Adidas has been focusing its efforts on expanding in China, where its apparel business accounts for about 40 percent of global sales.
The deal will be subject to regulatory approval, which could take several years.
The U.S. Federal Trade Commission last year finalized an agreement with Adidas that required the company to set up an internal supply chain, including a separate procurement agreement with its suppliers.
It said the agreement would help the company reduce costs.
The company has been investing heavily in its supply chain in Asia and has pledged to double its spending on apparel by 2020.