Guinness Battles Rivals for Premier League Deal

By Mark Kleinman, City Editor | Sky News

The Barclays Premier League is the most lucrative footbal league in the world.

The Barclays Premier League is the most lucrative footbal league in the world.

The owner of Guinness is among a pack of blue-chip companies battling to secure the title sponsorship of the English Premier League in a deal expected to be worth more than £150m.

Sky News has learnt that Diageo, the FTSE-100 alcoholic drinks producer, is working on a bid for the rights which is likely to be tabled in the coming weeks.

Barclays, the incumbent sponsor, has signalled to the administrators of English football’s top division that it may also bid despite widespread expectations that it would withdraw when its existing deal expires at the end of next season.

Illustrating the global appeal of the sponsorship, Samsung, the Korean consumer electronics giant which sponsors the current Premier League leaders Chelsea, is understood to have expressed an interest in bidding for the title sponsorship.

Ford and Mastercard have also been touted as potential candidates, although it was unclear on Thursday whether they were likely to make formal offers.

Insiders confirmed the Premier League had gone to the open market with the property, which is one of the most valuable single-sport sponsorship deals in the world.

Diageo does not have a top-level football sponsorship deal in the UK, and senior executives believe the Premier League could offer a valuable platform to promote the brand across Africa, Europe and Asia, where it is enjoying substantial sales growth.

Diageo's brands include, Guinness, Johnny Walker, Smirnoff and Bailey's

Diageo’s brands include, Guinness, Johnny Walker, Smirnoff and Bailey’s

However, sponsorship industry sources pointed out that Diageo’s ambitions of landing the deal could be complicated by the fact many Premier League clubs have individual supply and sponsorship agreements with rival beer brands.

They also highlighted the impact of possible curbs on sports sponsorship by alcohol brands after the General Election in May.

Labour has previously implied that it could seek to restrict or ban such tie-ups, although the party has made no announcement that such a measure will become official policy.

In 2012, Barclays agreed a three-year deal with the Premier League valued at £120m, which includes global title sponsorship rights, UK and international TV programme accreditation, extensive advertising rights, matchday tickets and hospitality, as well as joint community activity.

Barclays had been expected to walk away from its association with the Premier League after more than a decade, with some executives reportedly describing it as possessing “zero value”.

But sources close to the bank confirmed that it had made no such decision to withdraw and said it was continuing to evaluate a potential renewal.

Under the terms of the auction being run by the Premier League, the incumbent sponsor does not have the right to match a higher bid from a rival, according to a source.

The Premier League’s growing global audience has fuelled expectations that the next three-year deal could fetch upwards of £60m annually, with a deal expected to be concluded before the summer.

In addition to the headline cost, sponsors must commit a minimum sum to “activating” the association.

The fight for the title sponsorship comes as a more lucrative battle to secure live television rights looms.

The Premier League is expected to announce in the next fortnight the outcome of its next domestic TV rights auction, which last time commanded an overall price of more than £3bn.

Sky plc, the owner of Sky News, owns the majority of the rights under the existing deal, with BT holding the remaining packages.

Virgin Media, which is owned by the US media company Liberty Global, has called on Ofcom, the media regulator, to delay the TV rights while a competition investigation is ongoing.

Barclays, Diageo and the Premier League all declined to comment.


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