Germany's manager magazin said hedge funds including Knight Vinke, Third Point and TCI were considering buying stake in the world's second-largest sportswear company, driving a 4 percent jump in its shares.
But Eric Knight, founder of activist fund Knight Vinke, poured cold water on the report: "We don’t have a shareholding and it's not something we're following," Knight told Reuters.
Citing unnamed financial sources, the magazine said the funds would seek radical changes at Adidas, including the removal of Chief Executive Herbert Hainer and the possible spin off of fitness brand Reebok and golf label TaylorMade.
An Adidas spokeswoman declined to comment on the magazine report. But she also said: "We constantly conduct an open and constructive dialogue with investors."
TCI and Third Point declined to comment.
Adidas has been losing market share in its home territory of western Europe to larger U.S. rival Nike and has failed to make serious inroads in North America despite buying golf market leader TaylorMade in 1997 and Reebok in 2006.
The company issued its third profit warning in a year in July, blaming a plunge in sales at its golf business and its exposure to a weak Russian market.
Adidas shares, which have fallen by more than a third this year, were up 4.1 percent by 1334 GMT (02:34 p.m. BST), leading a 0.5 percent rise in the German DAX index.
They had already risen earlier this week on a Wall Street Journal report that unnamed investors had met with the company to demand management changes, including the possible early replacement of Hainer, CEO since 2001.
"The stock is trading with a management discount," Ingo Speich, a fund manager at Union Investment which is the ninth-biggest investor in Adidas with a 1.2 percent stake, told Reuters.
Speich, who called unsuccessfully on shareholders in May to refuse to grant the customary endorsement of management's actions, said that Adidas' diminished market capitalisation of 12 billion euros (9.53 billion pounds) could make it easy for hedge funds to build up an influential stake.
But Equinet analyst Ingbert Faust, rejected the possibility that Hainer would be easily unseated.
"Of course some investors are unhappy for good reason," he said. "I don't expect the dismissal of the executive board ... Such reports are really worthless. The fact that they move the share price shows that the stock is undervalued."
Hainer had his contract extended until 2017 earlier this year to allow the company to work on a succession plan. He has recently overhauled top management, appointing Roland Auschel and Eric Liedtke as new heads of global sales and global brands.
(Additional reporting by Simon Jessop in London and Thomas Atkins in Frankfurt; writing by Emma Thomasson; Editing by David Clarke and Jane Merriman)
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