Manchester United are looking for a new shirt sponsor after they agreed with Teamviewer that the current deal will come to a premature end.
The club issued a press release yesterday confirming what had been reported some weeks ago – that the German technology company was pulling out of the deal early.
“After a period of collaborative, private discussions over the past months, Manchester United and TeamViewer AG have reached a mutually-beneficial agreement under which Manchester United shall have the option to buy
back the rights to the club’s shirt front sponsorship,” the club statement read.
“Having agreed its partnership with TeamViewer at the height of the Covid-19 pandemic, Manchester United will be taking the opportunity to commence a focused sales process for a new shirt front partner in a normalised market.
“Once a new shirt front partner is selected and takes on this role, TeamViewer will continue as a valued member of Manchester United’s suite of global partners, providing Manchester United with remote connectivity solutions, until the end of the original contract term in 2026.
“TeamViewer’s financial commitments to Manchester United remain unchanged whilst they remain the club’s shirt front partner, after which their financial commitments will reflect their status as a global partner.”
From Teamviewer’s perspective, the decision comes after investment company Petrus, which owns a 10% stake in the company, “demanded that TeamViewer stop ‘bleeding millions’ and ‘rapidly disengage from this mess’ concerning the partnerships with United and Mercedes Formula 1”, as The Athletic reports.
The news is not so much an indictment of United’s status in world football as much as an acknowledgment from the sponsors that they had perhaps overreached in agreeing the deal in the first place.
Teamviewer pay a whopping £47 million a year despite only having an annual profit of around £43.5 million.
However, this is scant consolation for United, who now have to try to find an alternative sponsor at a time when their finances are already stretched and whilst the club is up for sale.
Given these circumstances, it is inevitable that any new deal will be worth much less than the Teamviewer one, which in turn was much lower than the previous deal with Chevrolet.
That seven year deal was worth $599 million – approximately £70 million a year.
The good news for the Red Devils in this case is that Teamviewer will stay in place until a new sponsor is found, which will allow CEO Richard Arnold some breathing space to thrash out as lucrative a deal as possible.
And a silver lining as far as fans are concerned is that the news will put more pressure on United’s share price, driving down the club’s value and therefore, potentially, forcing the Glazer family to drop their asking price. Anything that devalues United at this point in time could, for that reason alone, be a case of short term pain for long term gain.