Liverpool vs New Balance as Sportswear Firm Takes Reds to High Court
Liverpool has a new opponent in the form of New Balance, as the sportswear giant tries to prevent the Kop from agreeing to a new shirt manufacturing deal with Nike. While Liverpool currently has a deal in place with New Balance, that deal, worth an estimated £50 million a year, comes to an end in May of next year.
The reds are sitting at the top of the Premier League and could do without such distraction. Fans are counting on their beloved Kop to go all the way this year, and many will be putting their money where their mouths are. Reds fans like to have a flutter on their team- in fact, even when there’s no football on, they’re known for enjoying an online casino experience, whether it’s the slots or classic table games like blackjack and roulette – so are unlikely to be put off by the dispute with New Balance. It’s unlikely to stop them buying Liverpool shirts, either, even if we don’t know as yet what sportswear brand will be on them in the near future. The Boston-based New Balance, who has been with the reds since 2015, filed their surge earlier in September.
Matching clause
The reds were all set to sign on the dotted line on a long-term knitwear deal with Nike worth around £70 million a year, according to reports. That would be a £25 million increase on their current deal. Since then, however, New Balance has sought to enforce a clause in its contract with Liverpool, which allows them to match Nike’s offer and renew its current contract.
Liverpool has said that it won’t comment on the dispute while legal proceedings are underway. Nike also declined to comment. And while New Balance gave no immediate response, they later gave a statement to sports news website The Athletic, in which it confirmed the reports. The dispute, which will be heard in the UK High Court, will resolve to clarify the terms of the clause. Liverpool’s argument is that Nike’s distribution network is greater than New Balance’s and that New Balance can’t adequately fulfil its proposed terms.
Eye-popping numbers
Liverpool’s proposed deal is among the biggest in the Premier League. Earlier in 2019, Football Group (the owner of Manchester City) signed £65 million 10-year deal with Puma. The club with the largest deal is Manchester United, who have a £75 million per year contract with Adidas. Sportswear manufacturers are offering increasingly high figures to the biggest clubs in the world as a result of fans’ insatiable hunger to wear the shirts of their favourite players, so the eye-opening numbers merely reflect a club’s worldwide popularity. The deals pay in the long-term, as clubs typically receive a small percentage of shirt sales, with the majority of proceeds going to the supplier.
Nike’s base figure offer is vastly higher than the current New Balance deal and includes an additional fluctuating amount based on global sales. Liverpool has been involved in negations with multiple sportswear manufacturers over a number of months. They’re seeking to make the most of their commercial value with a strong side currently flying high in the Premier League, not to mention being the current European trophy holders. The suggestion is that the potential of Nike’s overall offer left the competition in their wake. The reds are hoping that their success on the pitch will ultimately secure them a deal with Nike that could close in on Adidas’s £110 million a year deal with Real Madrid or the £100 million a year that Nike currently has in place with Barcelona.
