Nike Inc. (NKE:US)’s 13-year relationship with Manchester United (MANU:US) will end next season because renewal terms sought by the record 20-time English champion were excessive, the world’s largest sporting goods maker said.
The current contract, signed in 2002, is worth a minimum of 23.3 million pounds a year to United through the 2014-15 season. The team wanted to increase that to more than 60 million pounds, a person familiar with the discussions said yesterday.
“Any partnership with a club or federation has to be mutually beneficial,” Beaverton, Oregon-based Nike said in an e-mailed statement. “The terms that were on offer for a renewed contract did not represent good value for Nike’s shareholders.”
The agreement gave Nike the right to match a rival offer before United could sign a new contract. Nike declined, paving the way for United’s jersey to be made by a new company. The club has been in talks with Germany’s Adidas AG, which is second to Nike in the sporting goods sector. United’s jerseys previously were made by U.K.-based Umbro.
United spokesman Philip Townsend declined to comment in an e-mail.
United finished seventh in the Premier League last season, a year after winning the title during Alex Ferguson’s last campaign as coach. Ferguson’s successor, David Moyes, was fired before the end of the season and will be replaced by Netherlands coach Louis van Gaal after the World Cup.
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