Bloomberg News

Hublot Dropped Manchester United After Ferguson Retirement (1)

August 15, 2013

Hublot, the luxury watchmaker owned by LVMH Moet Hennessy Louis Vuitton SA (MC), said Alex Ferguson’s retirement as manager of Manchester United contributed to its decision to end five years sponsoring England’s soccer champion.

The arrival of several new sponsors at the club was another reason behind Hublot’s decision not to renew its association, Hublot Chairman Jean-Claude Biver said by phone today. His version of events was disputed by Manchester United, which said the Nyon, Switzerland-based watchmaker was outbid.

“We had a certain disappointment when I heard that Sir Alex was going to retire,” Biver said today in a telephone interview. “That fact that Sir Alex was going to put a certain distance between him and Manchester, and still be involved but not anymore at the same level of command, was an element that helped us to make a change after five years.”

Ferguson retired as manager at the end of last season having led Manchester United to 38 trophies in 26 years. The club, the world’s second-richest sports franchise, said yesterday that it signed a three-year partnership with U.S. watchmaker Bulova, replacing Hublot as its official timekeeper.

The reasons cited by Biver “had not affected their willingness to renew at the time when Bulova and a number of other parties made much higher offers for the partnership and the club had declined Hublot’s bid,” Phil Townsend, director of communications, said today by e-mail. “Both those events occurred prior to Sir Alex’s retirement and the club continued with the process, without Hublot, throughout that time.”

‘Golden Contract’

Manchester United last month signed PepsiCo Inc. (PEP:US) to its list of more than 30 sponsors, after last year adding Chevrolet.

“When a new partner is coming in, sometimes they might not have the same coherence,” Biver said.

Still, Hublot has no regrets over the partnership with Manchester United, which more than paid for itself in advertising and sales, Biver said. He declined to provide financial details of the agreement, which the parties said at the time was a “multimillion-pound” sponsorship.

“Manchester United was a golden contract for us,” Biver said. “It really was one of the best contracts I ever did.”

Biver said 71-year-old Ferguson had become a personal friend since Hublot began sponsoring the team in 2008.

“I see him on a relatively regular basis, when he comes to France or when I go to England,” the executive said. In addition to a passion for soccer, the two men share a love of good food and fine wines, said Biver, a supporter of Swiss club FC Basel, which eliminated Manchester United from the UEFA Champions League in December 2011.

Bulova Contract

Soccer will remain the biggest element of sponsorship spending for Hublot, which last year entered a partnership with European champion Bayern Munich. The watchmaker is also a corporate sponsor of the 2016 European championships and the next three World Cup tournaments, Biver said.

Soccer represents about 40 percent of Hublot’s sponsorship budget, compared with 30 percent for Formula 1 and 20 percent for basketball, Biver said. The company’s single biggest sponsorship agreement is with Ferrari, he said.

Manchester United’s agreement with Bulova, a unit of Japan’s Citizen Watch Co., allows the New York-based company to place its name on scoreboards at United’s Old Trafford stadium and on advertising hoardings. Bulova will also take over from Hublot in producing timepieces using the club crest.

Manchester United spokeswoman Kate Lowe declined to comment on the value of the new partnership, which places Bulova alongside sponsors including Aon Plc (AON:US), Nike Inc. (NKE:US) and DHL.

Manchester United is worth $3.2 billion, according to the Forbes list of the world’s most valuable sports teams, published in July. That places the franchise second only to Spanish soccer club Real Madrid, valued at $3.3 billion.

To contact the reporter on this story: Paul Jarvis in London at pjarvis@bloomberg.net

To contact the editor responsible for this story: Celeste Perri at cperri@bloomberg.net


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