Manchester United have smashed the shirt sponsorship record by signing a seven year agreement with General Motors’ Chevrolet brand in a deal worth £357m, starting in the 2014/15 season.
This means that United will get £51m per year (on average), dwarfing the previous record of £25m set by Qatar Foundation’s sponsorship of Barcelona. Chevrolet will replace American insurance group Aon as the primary shirt sponsor of United who currently pay £19.6m per year with their deal.
Here is the confirmation, taken from the revised prospectus for the IPO:
Consistent with our strategy to grow our global sponsorship revenue, we entered into an agreement with General Motors for Chevrolet to become our exclusive shirt sponsor, beginning in our 2014/15 season. The term of the agreement runs through the end of the 2020/21 season. Annual revenue from our new shirt sponsorship agreement will be $70.0 million in the first season, and will increase by an additional 2.1% in each season thereafter through the term of the agreement. We will also receive approximately $18.6 million in fees in each of the 2012/13 season and 2013/14 season under the terms of our new shirt sponsorship agreement. Total revenue payable through the end of the 2020/21 season under our new shirt sponsorship agreement is approximately $559 million.
The Americanisation of United since the Glazers have taken over has been broad and deep and with deals like this, as well as United being placed on the New York Stock Exchange in a controversial IPO agreement, it doesn’t look like a trend set to change. Considering Vodafone sponsored United’s shirts for only £8m a year in 2006, the rapid growth of the United brand has been phenomenal for the global power of United but it has publicly been met with much disdain from some fans.
The U-turn by the Glazers with the IPO, where they are now set to gain over £100m for themselves despite promising that all the proceeds would pay off the club’s debt, is the latest in a series of damaging decisions which is doing nothing to help the relationship between the owners and fans. MUST have started a petition which will inform all the banks of the opposition to the IPO in an attempt to try and protect the future of the club.
These figures may be bringing substantial money into the club but with over $500m being lost over the past seven years due to crippling interest payments from the Glazer’s debt, how much of it are we set to see?
One thing is for sure – this is one massive sponsorship deal.