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Wall Street will think of Umbro accretion/dilution in terms of earnings and EBITDA. What they aren’t getting is the value of owning the rights to reproduce the ‘kit’ for each’s team’s colors.

Umbro’s most valuable football asset – by a long shot -- is Manchester City.  MC is officially no longer the ‘Other Manchester’ after it beat Man United and later took the Premier League title for the first time in 44 years (the equivalent of the Mets beating the Yankees) on April 30.

Now Nike is selling the Umbro brand. Tough loss of the ManCity kit. Or is it? Interestingly enough, on May 5, just six days after beating Manchester United, and despite being only 3 years into a 10-year deal, Nike renegotiated Umbro’s contract with the club such that ManCity will don the Swoosh next year.

Eight days later, ManC won the Premier League crown.

The timing is no coincidence. 

HedgeyeRetail: Chart of the Day; Nike/Umbro - chart1


HedgeyeRetail: Chart of the Day; Nike/Umbro - Table 1