Manchester City's record £1bn deal with Puma and the value beyond bottom line

The Guardian

22-07-2025

Manchester City had a billion reasons to celebrate the new kit deal with Puma announced last week, yet beyond the bottom line the value of the contract may prove priceless.
The Guardian has learned that the 10-year deal, worth £1bn, contains clauses giving the German sportswear manufacturer options to extend the partnership way beyond that, but most significant to City may be what Puma's endorsement and huge financial commitment say to independent brands and the Premier League about the club's value.
The Premier League has twice accused City of using related-party companies to artificially inflate the value of their sponsorship revenue. It blocked proposed deals with Etihad Airways and First Abu Dhabi Bank in 2023, sparking an acrimonious legal battle that remains ongoing.
In a significant victory for the club, an independent panel ruled in February that the Premier League's associated party transaction (APT) rules in operation at that time were 'void and unenforceable'. City have since launched a legal challenge against amended APT regulations voted through by 16 clubs last November. Another independent panel is expected to rule on that matter later this year, with City reserving the right to sue the Premier League, depending on the outcome.
The kit deal with Puma could prove an extremely useful weapon in City's armoury, as well as opening the door to other lucrative contracts, which has not gone unnoticed at other clubs.
'This is a huge deal for City, in terms of what it says about the size of the club and their ability to attract independent sponsors,' a senior executive at another club told the Guardian. 'City have submitted two legal challenges to the Premier League's APT rules after having two sponsorship deals blocked. But maybe those deals weren't overvalued after all?'
The reported value of the Puma deal has attracted some scepticism because, at £100m a year, it is a huge rise on City's existing £65m-a-year Puma contract. The increase does not reflect City's recent merchandising sales which, according to figures collated by Uefa, brought in £69m last year, just over half the revenue generated by Manchester United and Liverpool, and far behind the world leaders, Real Madrid, whose merchandising income was £170m.
City's ability to generate more than the £90m and £60m annual payments United and Liverpool will receive from Adidas next season has been widely questioned given their north-west rivals have larger global fanbases, but independent experts are adamant that Puma would not overpay.
'Puma's strategy is based upon having a smaller number of iconic clubs so Manchester City fits this profile,' Ricardo Fort, a former head of sponsorship at Coca-Cola and Visa who now runs his own consultancy firm, told the Guardian. 'They also have kit deals with other clubs in the City Football Group, including Palermo and Melbourne, but City will be their priority.
'Puma are very disciplined about what they will pay for sponsorship deals so will not have overpaid, or at least not by more than they had to. They are very rigorous.'
Puma's relationship with City goes back to 2019, when they signed a group-wide deal that also covered Melbourne City, Girona FC, Club Atlético Torque and Sichuan Jiuniu FC. Despite this Puma had to beat off rival offers from Adidas and Nike to agree an extension, which may also go some way towards explaining its value.
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City's income and global profile have also increased significantly since 2019 on the back of the extraordinary achievements of Pep Guardiola's side, who have won 14 major trophies, including four Premier League titles in a row, and in 2023 became the second English team to claim the treble.
In their annual report published last December, City announced a Premier League record revenue of £715m for the 2023-24 season, with commercial income accounting for £344.7m. Over the past five years City's revenue has grown by 50%, an increase which broadly tallies with the value of the Puma contract.
For branding expert Marcel Knobil of BrandGuru, the partnership makes sense. 'Brands want to be associated with success and Manchester City can boast a record that no other club has achieved,' he said.
'The club also has an extremely wealthy owner behind it, which will also provide some future-assurance for Puma. Kit sponsors want teams to be both successful and packed with stars – and only deep pockets can secure the latter.'
Puma's renewed commitment is also a confidence boost for City while they await the verdict of the Premier League's 130-plus charges related to alleged breaches of financial fair play rules. Numerous industry sources told the Guardian that the contract would almost certainly include so-called 'bad faith clauses' enabling Puma to terminate if the club are found guilty of serious wrongdoing.
City declined to comment. The club have denied the charges, so do not consider early termination to be a possibility.