Under Armor notified the University of California, Los Angeles (UCLA) that it will explore options for terminating multi-million dollar clothing and a shoe deal with the university, a Baltic clothing company statement said on Saturday: reports USA Today,
In May 2016, Under Armor and UCLA signed one of the largest sports offerings in the history of American universities in the amount of $ 280 million over 15 years. The deal took effect in 2017 and put an end to the UCLA partnership with Adidas.
Under Armor’s statement read:
“Under armor recently made a difficult decision terminate our partnership with UCLAas we were pay for marketing benefits that we have not received for a long period of timeAgreement allows us stop in this case, and we exercise this right, ” Adam Rittenberg from ESPN,
“We know that it was a difficult time for athletes, sports programs and sportswear brands. “Under Armor will continue to maintain its strength in this complex environment, while maintaining a strong network of partnerships with individuals, organizations and leagues, which makes us the local authority for targeted performers.”
In reply, UCLA released a statement referring to the actions of Under Armor:
“UCLA track and field found out this week that under armor trying to stop A 15 year contract for clothes and shoes with us and the Bruin community. we exploring all our capabilities to resist Under Armor“We continue to strive to provide our hardworking staff and student athletes with the shoes, clothing and equipment needed for training and competition at the highest level, as they – and our loyal fans of Bruin – deserve,” the statement said. Rittenberg.
Although Under Armor claims that it didn’t “get marketing benefits” from the UCLA deal, one of the reasons for the termination of the contract is that the COVID-19 pandemic seriously affected the companyThe company’s revolving plan (begun before the crown) was not able to increase revenue – as sales are expected to fall this year compared to last year.
And not only the sportswear company was in a difficult financial situation – in January UCLA Athletics recorded a budget deficit of $ 18.9 million, just a few months before the virus pandemic canceled spring sports events.
More through The los angeles times Why Under Armor Funds UCLA Sports Programs:
Under the agreement, Under Armor paid UCLA $ 15 million in advance, in addition to approximately $ 11 million per year for rights and marketing fees. The clothing company also agreed to provide an average of $ 7.4 million to the school. USA for clothes, shoes and equipment each academic year, while providing $ 2 million. Over an eight-year period to modernize sports facilities.
Under Armor founder Kevin Plank last week unloaded his mansion in Washington, DC, 41% below the requested location,
It remains to be seen whether Planck will be able to dump his 189-acre property in Glyndon in Baltimore County, called the Sagamor Farm, worth about $ 20 million.
Under Armor tried to terminate the deal with UCLA, failed the restructuring plan, restructured and fired, and also reduced revenues; all this suggests that the company for the production of sportswear is in serious condition.