Nike Expected To Bid For Umbro, Increase Soccer Presence
Nike is believed to be close to launching a takeover bid for U.K.-based sports apparel and shoe company Umbro, according to Butler, Kennedy & Hawkes of the LONDON TIMES. Sources indicated that the two sides have been “in discussions for some time and details of a preliminary offer could be announced ‘in days rather than weeks.’” Nike has been “aggressively expanding into the [soccer] market in the past few years and industry sources said a buyout of Umbro … would help its aim of dominating the sport.” A takeover of Umbro would give Nike a “huge presence” in the English Premier League, where Umbro supplies six clubs. Nike currently supplies kits to Arsenal and Manchester United. Upon news of the potential takeover, Umbro shares yesterday rose 27.5%, valuing the company at US$450M (LONDON TIMES, 10/19). Despite speculation that Sports Direct Exec Chair & Founder Mike Ashley, who owns a 15% stake in Umbro, had approached the company about a takeover, sources said that he is “not behind the possible bid” (London INDEPENDENT, 10/19). Umbro has rights to the England national team's jerseys until 2014, but the contract with the Football Association contains a "change of control clause, that would allow the FA to switch to a new brand if Umbro were taken over" (FINANCIAL TIMES, 10/19).
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