Arsenal's £100M Sponsorship Deal With Emirates No Longer Looks Like a Good Deal
Arsenal F.C.'s sponsorship pact with airline Emirates once looked like a good deal for the club: The Gunners received £100 million for a 15-year lead sponsorship contract in 2004. But five years in, that deal looks less like a lottery win and more like a millstone. Arsenal receives far less for its sponsorship rights than comparable clubs Manchester United, Chelsea F.C. or Liverpool F.C. At the same time, a BBC report indicates the club is crippled with debt. It owes a total of £416 million, according to The Guardian; and has "£242m of separate debt" on the construction of its stadium, according to the BBC.
But the Emirates sponsorship breaks down to just £6.7 million a year over the course of the deal. Manchester United just signed a deal with Aon worth £20 million a year; Chelsea's with Samsung is worth £10 million a year; and Liverpool gets £7.2 million from Carlsberg in a deal that is up for renegotiation soon.
Meanwhile, Arsenal's margins are thin. Its EBITDA will fall to just £35-40m in 2010, the BBC reported. And the club has trouble raising cash to buy players -- the crucial expense on which all revenues depend.
The club recently rejected the idea of selling stock to its fans to raise £150 million; perhaps it is time examine the Emirates contract for loopholes that will allow the club to negotiate anew?
- A selected list of football sponsorship deals:
- £100 million Arsenal's 15-year deal with Emirates
- £80 million The four-year deal Manchester United signed with Aon takes effect next summer
- £75 million Juventus have a five-year contract with Tamoil, the international oil company
- £68 million Bayern Munich's four-year deal with T-Home
- £50 million Chelsea signed a five-year contract with Samsung in 2005
- £38 million Real Madrid's three-year deal with Bwin.com, the Austria-based online gaming company
- £7.2 million Liverpool's annual fee from Carlsberg expires in 2010
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- Manchester United Sign Aon to Replace AIG as Shirt Sponsor; Club Returns to Profitability
- Manchester United to Swap AIG for Sahara Group as Shirt Sponsors
- For Manchester United, Sponsorship Deal Gets Complicated With Premier League Win, Ronaldo and Tevez Talks
- Why Manchester United Must Ask Prudential for More Money to Replace AIG Sponsorship
- $28 Million in AIG Taxpayer Money Spent on Manchester United
- Q&A: Fox's Steven Cohen on the Advertiser Boycott Over His Remarks on Soccer Stadium Deaths
- Fox Host Lambasts Sponsors for Abandoning Show After Remarks on Soccer Stadium Deaths
- Liverpool F.C. Might Replace Carlsberg as Shirt Sponsor
- Fox Host Says Advertiser Boycott Over Remarks About Soccer Fan Deaths Has Hurt His Show
- Advertisers Abandon Fox Soccer Channel Host After He Blames Liverpool Supporters for 96 Deaths in Stadium Crush