Manchester United faces a serious threat to its £900 million deal with adidas, with the possibility of termination if the club relegates from the Premier League.
Currently sitting in 14th place, Manchester United have won only two league matches since Ruben Amorim took over as head coach in November. The Portuguese manager has struggled to find the right balance as he works to implement his methods on a squad that has been performing below expectations.
Following a damaging defeat to Newcastle, Amorim admitted that relegation is a real possibility, acknowledging the team’s dire situation. “We have to be clear with our fans,” he said. “People are tired of excuses. Sometimes I talk about relegation because our club needs a shock.” United are currently seven points ahead of 18th-place Ipswich Town, but with the team failing to turn things around, supporters are growing increasingly concerned about their survival in the top flight.
Should United suffer relegation, adidas, the German sportswear giant, has the power to terminate their £90 million-per-year deal, which runs for another six years. According to the Telegraph, the 10-year agreement allows adidas to cancel the contract by giving just one season’s notice if the club relegates to the Championship.
Alternatively, adidas may choose to reduce payments for 12 months, cutting the fee paid to United in half, from £90 million to £45 million.
Relegation would significantly impact United’s financial stability. In the 2023/24 season, the club earned £222 million in broadcast revenue, with nearly 80 percent of that coming from the Premier League. If relegated, United would receive parachute payments, which amount to 55 percent of the Premier League’s equal TV rights share for the first year in the Championship, equating to roughly £43.6 million.
Even if they avoid relegation, United face a perilous road ahead, with the club in danger of missing out on European football next season. According to the club’s financial report, they generated £166.3 million in broadcast and matchday revenue from European competitions over the past three years.
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