The Price Of An England Shirt - 29/10/2007

Nike's £285m bid for Umbro, a 61 per cent premium to last week's share price, shows how much value the largest sportswear company in the world attaches to the white England shirt. It is one of the most popular in the world. Mark Parker, Nike's chief executive, said that he believed, that with England's and the yellow shirt of Brazil, he now had the two most valuable sponsorship deals in world football. He described the England contract as 'the crown jewel in Umbro's crown.' The FA has given its backing to the deal by choosing not to activate a change-of-ownership clause in the contract. The deal could still be scuppered by a counterbid from Adidas or blocking tactics from Sports Direct and JJB Sports which dominate the UK distribution of sportswear and between them hold more than 25 per cent of Umbro. Mike Ashley, the founder and chief executive of Sports Direct, also owns Premiership club Newcastle United. The retailers are said to be concerned about the concentration of brands among two large international players. Although market shares in the football market are very difficult to estimate accurately, Nike and Adidas would probably control 75 per cent of the 'legitimate' world market if the deal went ahead, something that might attract the attention of competition authorities.