Breaking News

Are Newcastle United’s new owners moving to Adidas? Might depend on contract term

It was no surprise that the Adidas name has been mentioned a few times over the past few days.

The final closing of the Newcastle United acquisition has resulted in fans talking about endless possibilities that could now open up with new ambitious owners at the helm.

Adidas was a predictable brand to be brought up considering they are associated with not only arguably the best NUFC jerseys we’ve ever seen, but also the best era on the field that the vast majority of the Newcastle supporters has seen in their lifetime.

Adidas had fifteen years with Newcastle United from 1995 to 2010 before Mike Ashley joined PUMA.

This lasted until this summer and replaced PUMA as a kit manufacturer after eleven years.

So the big question is, can we now expect a quick move from Castore to Adidas or possibly another big hitter like Nike. Or maybe the even bigger and more relevant question is, is it possible?

An industry specialist paid some attention to the issue after the acquisition, saying it could be a very important contractual clause and whether or not it was included when Mike Ashley closed his deal with Castore earlier this year.

Writing for Sports Business today (October 13, 2021), Matthew Glendinning says of Castore’s position at Newcastle United:

“The key to the brand’s next step may depend on whether or not there is a“ change of ownership ”clause in their contract. Such clauses enable the party concerned to cancel the contract if the other party changes hands.

For Newcastle, the kit deal is one of the largest sponsorship deals. Under new ownership and with the funds to upgrade the roster significantly, the deal could soon be worth many millions more than the reported £ 5m per season Castore is currently paying.

It’s unlikely Ashley didn’t take this into account when signing with Castore.

On the flip side, after reviewing each commercial contract as part of their due diligence, the new owners could have simply negotiated the club’s value down to account for the “sub-optimal” rights fee compared to the higher rate the club received we will certainly have orders when the money is injected into new players.

Change of ownership clauses also allow brands to withdraw from an association with a new owner that may not be in their best interests.

So the big question is whether there is a “change of ownership” clause in Ashley’s contract with Castore?

If so, there seems to be an option for both parties to withdraw from this original / current deal.

It is very difficult to imagine that Castore would vote with his feet in this case, as they assumed a position in which a large number of the fan base refused to buy official goods because they no longer had the opportunity to use their money for the time NUFC wanted owners, in a position where the existing Newcastle United fan base, in the vast majority of cases, is only too happy to buy official stuff again and hopes / expects that money will help create better times. Not to mention the fact that if Newcastle is successful, how many more supporters it will attract elsewhere.

If the new Newcastle United owners can step back from the Castore deal and possibly the FUN88 shirt sponsor as well, it will be interesting to see what steps they can take and how quickly they do so.

Of course, no financial outlay to change kit manufacturer would be the best option for the new NUFC owners if they actually wanted to make changes, but if there isn’t a new owner clause they could try to buy their way out of the Castore deal as well if that was the way they wanted to go.

As with so many things Newcastle United now, we look forward to seeing what positive steps the owners will take to influence things on and off the pitch.

Leave a Reply