English Premier League soccer club Manchester United has signed a new sponsor for its training kit for the next eight years, the latest in a series of commercial deals cashing in on its huge global following.
United, English champions a record 19 times and controlled by the American Glazer family, are unusual in that their image is strong enough to attract backers for both their training kit and the famous red shirts they play in.
The club called an early halt to its existing agreement with training kit partner DHL after July's record $560-million (U.S.) deal to have the Chevrolet brand on its playing shirts for seven years showed the club it could aim higher.
Chevrolet's sponsorship begins in 2014. Until then, United will receive about £20-million ($31-million) a year to carry the name of U.S. insurer Aon on the team's playing shirts.
The training kit deal will run for eight years from next season but the club was surprisingly coy about identifying the new backer at this stage.
"At the request of our new training kit partner, we have agreed to withhold further details pending a formal announcement," vice-chairman Ed Woodward told financial analysts on a conference call.
DHL had been paying about £10-million a year for its innovative training kit deal, sources with knowledge of the agreement said. The sponsorship had been due to run for four years from 2011.
United, currently top of the Premier League, signed six new sponsorship deals with companies around the globe in the last three months of 2012, the second quarter of the club's financial year.
Those deals helped the club to achieve record revenue and underlying profit in the quarter, one of the busiest periods in the soccer calendar.
It posted revenue of £110-million in the three months to Dec. 31 and earnings before interest, tax, depreciation and amortization (EBITDA) of £50-million, in line with analyst forecasts.
The club said that it is on target to hit its financial targets for the full year.
United claims to be the world's best-supported soccer team, with more than 650 million followers worldwide and regular 75,000-strong capacity crowds at their Old Trafford stadium despite failing to win a trophy last season – the first barren year since 2005.
They lead the Premier League by 12 points and appear certain to regain the title they lost to local rivals Manchester City on the final day of last season.
On the European front, they drew 1-1 with Spain's Real Madrid on Wednesday as two of the world's richest clubs met in the first leg of their tie for a place in the quarter-finals of the Champions League.
Success on the pitch has helped to dampen criticism from fans who say that the Glazers loaded the club with too much debt when they bought the club for £790-million in 2005.
Borrowing fell to £367-million at the end of last year, down from £439-million a year earlier.
Manchester United shares have also strengthened on the New York Stock Exchange after a much-criticized listing last August.
They traded at $18.60 on Thursday, down 11 cents on the day, but well above the $14 listing price and valuing the club at more than $3-billion.
U.S. asset management company BlackRock has bought more than 8 per cent of the listed shares, dispelling the notion that serious investors are not interested in soccer clubs.
The Glazers retain a tight hold on the club thanks to the listing's dual-share structure.