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November 23, 2005

Vodafone pulls plug on Man Utd sponsorship

Mobile goliath Vodafone Group Plc is ending its four-year shirt deal with the English Premiership football club Manchester United. Instead, the Newbury, UK-based operator announced it wants to focus more on Champions League sponsorship.

By CBR Staff Writer

Vodafone will end the Man Utd deal at the end of the current football session in May 2006. It follows a drop in form over the past couple of years at the former Premiership champions, as well as a highly controversial takeover of the club by Malcolm Glazer, the US sporting tycoon who also owns the Tampa Bay Buccaneers.

Vodafone has sponsored Manchester Utd since 2000, and in late 2003 signed a 36m pound ($62m) four-year deal with the club, worth about 9m pounds ($15.5m) per year.

Manchester Utd meanwhile is said to be confident of securing a new deal in coming months. The English club has only had one other shirt sponsorship deal in its history, with Japanese electrical firm Sharp Corp for 18 years from 1982.

Vodafone said it is to start sponsoring the UEFA Champions League from next summer, as both an official partner and the official mobile network of the UEFA Champions League. The partnership will enable Vodafone to deliver content, including video highlights packages and goal alerts, from all UEFA Champions League matches to football fans on its Vodafone live! Service, for customers with 3G phones. Financial terms for the three-year deal starting in the 2006-07 season were not disclosed.

It is fairly common to see technology companies sponsor sporting teams. The largest current shirt sponsorship deal in English football is the 50m pounds ($86m), five-year contract Chelsea have with Samsung Electronics. However, even that contract is eclipsed by the massive 16m pounds ($27.5m) a-year the Spanish club Real Madrid will receive from Taiwanese mobile operator, BenQ Mobile, in a deal which takes effect next year.

In October, Microsoft Corp became the first Founding Partner for the new Wembley Stadium in North London, having signed a five-year deal worth at least 5m pounds ($8.6m).

The England rugby team is sponsored by the UK mobile phone operator O2 Plc (currently being acquired by Spanish telecoms giant Telefonica SA), while the Formula One racing team Williams recently lost its chief sponsor, Hewlett-Packard, as well as engine supplier BMW.

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