Manchester United could face £900m Adidas deal termination if relegated

Manchester United could face the termination of their £900 million deal with Adidas if they are relegated from the Premier League.

Currently sitting 14th in the league, United have won only two top-flight matches since Ruben Amorim took over as head coach in November.

The Portuguese manager has struggled to find a winning formula, as he works to implement his methods on a squad that has yet to meet expectations.

When asked whether United are in a relegation battle following their recent defeat to Newcastle, Amorim responded: “I think that it is a possibility. We have to be clear with our fans.

“We have to acknowledge our position. I think people are tired of excuses in this club. Sometimes I talk about relegation. Because our club needs a shock.”

Manchester United currently sit seven points clear of Ipswich Town in 18th place, but recent comments from manager Ruben Amorim offer little reassurance to fans that the club won’t be drawn into a relegation battle in the second half of the season.

Should the worst-case scenario unfold, United could face significant financial repercussions, with Adidas holding the power to terminate their £90 million-per-year sponsorship deal, according to The Telegraph.

The 10-year contract includes a clause that allows the German sportswear giant to give just one full season’s notice if United were to drop to the Championship.

Alternatively, reports suggest that Adidas could opt to reduce payments for 12 months.

In such a case, the club would see their yearly fee slashed by half, from £90million to £45million, should they be relegated.

The prospect of relegation brings considerable financial uncertainty for the club.

United earned £222million in broadcast revenue during the 2023/24 season, with nearly 80% of that figure stemming from Premier League rights.

However, relegation would drastically reduce this revenue. Parachute payments for relegated clubs provide just 55% of the Premier League’s equal TV rights share in the Championship, which currently amounts to £43.6million for the first season, according to The Athletic.

Even if relegation is avoided, United still face the risk of missing out on European football next season, a blow that would further impact their financial standing.

The club’s annual financial report reveals that £166.3million was generated from broadcast and matchday revenues linked to European competitions over the past three years.

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