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City Sells Stadium Name To Etihad Airways

City Sells Stadium Name To Etihad Airways

Vital Manchester City received the following press release from news organisation, Bloomberg. This material is subject to strict copyright law.

Manchester City club owned by Sheikh Mansour bin Zayed Al Nahyan of Abu Dhabi, will sign the richest sponsorship agreement in its history with Etihad Airways, the Gulf state's government-owned airline, according to two people familiar with the transaction.

Etihad, which pays £2.3 million ($3.7 million) a year as the team's shirt sponsor, will get naming rights for the City of Manchester Stadium, said the people, who declined to be identified because the deal hasn't been publicly announced. They declined to reveal the terms of the contract, which will be announced soon. Etihad and City declined to comment.

Mansour has spent almost $1 billion since acquiring City in September 2008. He's bought international players including Carlos Tevez and David Silva in an effort to win trophies and outpace rival cross-town rival Manchester United, which last season won a record 19th English championship. City qualified for the Champions League and won the FA Cup last season, its first major trophy since 1976.

City has been trying to increase its revenue in an effort to meet new criteria on fiscal responsibility established by European soccer's governing body, UEFA. Under those rules, clubs that can't keep costs and income at an acceptable level face being banned from the Champions League, Europe's elite competition.

City's accounts for the year ended May 31, 2010, show it lost £121.3 million, 31 percent more than a year earlier.

Financial Fair Play

"There`s a sense, but UEFA will say it's not the case of course, that financial fair play is aimed at clubs like Manchester City and Chelsea who have wealthy benefactors," said Stefan Szymanski, a professor of sports business at London`sCass Business School.

"If this sponsorship deal were not to be a fair value deal Manchester City would be caught out, but I don't believe that's the case."

UEFA will allow teams to incur losses for infrastructure and youth development. Its General Secretary Gianni Infantino said the Nyon, Switzerland-based organization will monitor sponsorship deals to ensure agreements are based on fair value.

Infantino was responding to concerns that wealthy benefactors could use sponsorship deals to inflate the balance sheets of teams they own. Mansour is a member of the Abu Dhabi royal family.

In last year's results Manchester City said revenue from sponsors and partners grew 400 percent to £32.4 million because of agreements with Abu Dhabi-based companies including telecommunication company Etisalat, Aaabar Investments PJSC, the Abu Dhabi Tourism Authority and Etihad.

City moved to the City of Manchester stadium from its Maine Road ground in 2003. In October it re-negotiated with Manchester City Council to allow it to sell naming rights.

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Writer:danielqpr
Date:Thursday July 7 2011
Time: 8:05PM

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Comments

0
Sorry, but it's a bit pointless writing a piece on it, if we don't yet know the figures involved. Not having a pop, but we all knew it was happening already, the devil is in the detail...
HeavyRiffs
07/07/2011 20:24:00
0
Bloomberg wanted me to pass on the above, so I did. I'm sure the finer details will be announced soon.
tudor
07/07/2011 20:42:00
0
If this sponsorship generates more than £125 a week then Platini will be all over it like a rash!
RobsonGreensleeves
07/07/2011 20:50:00
0
Would I be cynical if I thought this would be a far bigger deal than anticipated o help you make an inflated appearance for sponsorship revenue? If for example they paid £10m a season, that makes a very nice addition to your revenue stream.
Oxfordspur
08/07/2011 00:25:00
0
Thats very likely Oxford Spur. In effect its one arm of the owners giving money to the other arm. Its hardly going to be an arms length transaction from the looks of it.
Deltaforce
08/07/2011 06:29:00
0
It will be monitored by the UEFA Ox and Delta, so I wouldn't worry your little cotton socks about it.
Bluedub
08/07/2011 07:40:00
0
It will be you not me worrying about it Bluedub!
Deltaforce
08/07/2011 13:59:00
0
if the Sheikh, has paid over the odds for the Naming rights, which i doubt, isnt that what ALL groups of companies have been doing since time began, ie pay company B a premium for it's services, from YOUR company C, hence less tax paid to the tax man and the money stays in the group... sound financial advice if you ask me!!!!!AND if fans of other clubs dont like it, tough....
cityman51
08/07/2011 14:10:00
0
What exactly will I be worrying about Delta? I'm sorry you've completely lost me.
Bluedub
08/07/2011 15:46:00
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