UFC’s Biggest Sponsor Bought Out
By celebritymoda on Jul 14, 2008
Budweiser, the UFC’s main, biggest and longest contracted sponsor in the brewer’s Bud Light brand, has just been bought out in a huge deal with a European company. Following is the AP’s story on the transaction.
“ST. LOUIS (AP) — Anheuser-Busch reportedly has agreed to be acquired by Belgian brewer InBev for about $52 billion. The deal being reported by The Wall Street Journal would create the world’s largest brewer and put the iconic American beer maker in the hands of the Belgian-based company behind Stella Artois and Beck’s beers. The newspaper cited anonymous sources who said Anheuser-Busch-InBev would be the new company’s name and Anheuser would have two seats on the company board. Anheuser-Busch (BUD, Fortune 500) did not return a message seeking comment Sunday evening.The newspaper said the deal was for $70 a share. That’s an increase over InBev’s original offer that was rejected in June.”
The greatest concern for the UFC, as stated by many financial experts is how exactly InBev will be able to cover the $70 a share stock price, which is a huge increase from the $52 a share that Budweiser had been stuck at for a year. The general understanding is that massive cuts will have to be made by Inbev to cover the high cost. Budweiser’s massive arsenal of sports sponsorships would almost certainly be one of the first expendable areas to be on the chopping block, which would be a huge blow to the UFC.
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They can always fall back on Mickeys…kinda.
They still have Harley Davidson who just recently cut a bunch of jobs here in York, PA.
Jobs is another concern, although not UFC related. There’s a group of about 100,000 people in St. Louis petitioning for the government to stop the sale because of all the jobs that will potentially be lossed.
And as far as the UFC’s other sponsors, my undertanding is the Bud Light deal was their biggest partnership ever, into the tens of millions and perhaps hundreds. Not too many companies have the ability to pony up that much in sponsorships and also have an interest in working with the UFC.
Very interesting thesis…..If you don’t mind i’m gonna link over to this on Payout for tomm…..
Robert: As long as Amy gets credit, go for it!
I don’t mind, I’m actually an avid Payout reader myself.
[...] MMA OpinionUFC’s Biggest Sponsor Bought Out [...]
While I’m an MMA fan and love the UFC product, I really don’t care about the implication concerning UFC sponsorship. Although I don’t live in the St. Louis area or any area that may be affected by job loss or anything . . . what are the implications for the U.S. job and possible affect on the U.S. economy?
If the UFC ends up losing Bud as a buddy, they will survive it but expect Dana’s public address stating “Bud F*CKING SUCKS, I prefers Corona,” followed by the first UFC show in Mexico featuring Huerta vs Florian II. The first fight ended in controvery with all judges scoring in favor of Huerta even though he was knocked down twice and nearly submitted in the 2nd round.
Well, it appears that many of the actual factory workers may keep their jobs, but the executive offices may be trimmed down a bit. Hopefully nothing major changes, but it’s not good to see another company get pushed out of the country.
I like how you’re pretending to live in York, Brandt
Don’t start playing “Allentown” by Billy Joel and pretending it’s not Bethlehem, good sir.
One thing to add seriously: I don’t think this company can just void the sponsorship deal. The deal justed started and runs over a few years, and I’m sure in a year or two there’s an option on the deal. Until then, I think it’s safe, and besides that, Bud would want to market to the younger audience UFC holds since I’d assume Budweiser pays the UFC ALOT less then they do to advertise on NFL/MLB/NHL/NBA games. I’d imagine it slips through when it does come up, or at worst gets restructure when it expires.
Eh, York is close enough to call it home.
I think the sponsorships with the big sports are more important, and would be protected from events like these. The UFC/Zuffa hasn’t dealt with anything like this before, have they?
The big reason why this concerns the UFC so much isn’t just a run of the mill sponsorship. The reports on the amounts of money the Bud is pumping into the UFC with this deal is quite some serious moolah. Covering pretty much all their event operations and production costs and still leaving a huge wad of cash thats undoubtedly helping curb some of the giant debts it takes to run the current UFC operation at their level they’re now operating on.
If we’re talking in the hundreds of millions of dollars, like some inside the UFC have hinted at, that would be a dibilating blow to be taken away from the UFC’s budget. Why do you think the biggest thing that Lorenzo was brought in to do was to reform the merchandising department? The UFC needs serious and steady cash to keep running this show they way they’ve been for the past 2 years.
So, its not just about sponsorship its about the UFC’s operations at their most fundamental levels.
fdr7JG Hello!,