Nike Grabs the Bull with Johnny Football Deal

Takeaway: Though Nike is no-stranger to athletes causing controversy, Manziel belongs on the upper half of the risk management watchlist.

Johnny Manziel Signs Deal to Be Represented by Nike

Nike Grabs the Bull with Johnny Football Deal - johnny0

  • "Rovell's sources were not able to disclose the financial terms, but they did say the deal—which was negotiated by LeBron James' business partner Maverick Carter and Fenway Sports Group—is a multi-year offer that will be the most expensive for a rookie in this year's class."
     
  • "Manziel chose Nike over other companies such as Adidas, Under Armour and New Balance's Warrior brand."

Takeaway from Hedgeye’s Brian McGough:

Nike is likely looking at something in the vicinity of $20 million/year for Manziel. But one thing is for sure,

 

Nike is going to have to babysit this one.

 

True, they may have 'handlers' for all their high-value athletes, but the sports world knows all too well that things don't always go according to plan. See previous tabloid-rich events like:

 

1. Kobe Bryant and his sexual assault case (after which his Nike contract was re-written).


2. Tiger Woods and his -- whatever you call it -- case.


3. Lance Armstrong and his pathetic admission of basically lying his whole career.

 

Athletes -- even those considered squeaky clean -- are high risk assets. Something tells us that Johnny Manziel belongs on the upper half of the risk management watch list.

Join the Hedgeye Revolution.


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