Manchester United signs 10-year deal with adidas

<p>Adidas will be Manchester United’s kit manufacturer for the next ten years.</p>

Manchester United and adidas have signed a ten-year agreement for the biggest deal of its kind in history.

Adidas will pay £750 million (£75 million a season) to make United's kit starting from the 2015/16 season. The moves comes after US firm Nike decided to end its association with the former Premier League champions after 12 years. Adidas' deal represents a major precedent in sports sponsorship and dwarfs the £31 million-a-year agreement with Real Madrid which the biggest club contract of its kind.

Nike will produce the kit for the 2014/15 season before the German sportswear giant takes over next season. Nike's final campaign coincides with United beginning their affiliation with US car giant Chevrolet, which will be the main shirt sponsorship. The agreement is worth a reported £53 million per season and will raise both the profile of United and Chevrolet across the globe.

A statement from United read: "Manchester United plc has reached a ten-year agreement with adidas for a global technical sponsorship and dual branded licensing deal for a minimum guarantee of £750 million, subject to certain adjustments, beginning with the 2015/2016 campaign.

"For the 2014/2015 season, Nike will continue in its role of technical sponsor and trademark licensee."

Adidas has previously worked with United, making the team's kits between 1980 and 1992 but since the club has signed a number of major deals with the likes of Umbro and Nike.

Under the terms of the agreement with adidas the German firms will provide training and playing kit to all the club's teams and will also have the exclusive right to distribute dual-branded merchandising products across the world.

As of 08:50 on Tuesday (July 15th), Manchester United plc's share price stood at 18.64 finishing 4.84 per cent up on the previous day.

Find up to date information on the FTSE 100 and spread betting strategies at City Index

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.