Manchester United to lose £25m from Adidas deal if they miss out on the Champions League

Manchester United's failure to secure Champions League qualification could lead to massive financial implications for the Red Devils. The Manchester United Adidas deal has penalty clause with could see the Premier League outfit lose out on additional sponsorship income from their kit partners.  Ole Gunnar Solskjaer's side failed to capitalise on the opportunity to move into the top four spot in the Premier League table after their draw against Southampton on Monday night, but are still in the running, and are only one point behind third-placed Chelsea. 

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Manchester United Adidas deal: Red Devils could £25m funding if they fail to seal Champions League qualification 

Manchester United have a mega-money £75m-a-year deal with Adidas, second only to  Liverpool's new £80m contract with Nike. However, the Manchester United Adidas deal has a specific clause will have the club hierarchy worrying, considering where they stand on the Premier League table. According to the Daily Mail, if Manchester United fail to seal Champions League qualification for two consecutive seasons, Adidas will not have to pay £25m of the £75m next season, taking the deal down to just £50m, much below the likes of their rivals Chelsea, Arsenal and Manchester City. 

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The Manchester United Adidas £75m deal is one of the most lucrative sponsorship deals across the globe, with only Real Madrid, Barcelona and Liverpool raking in more money from their kit sponsors. The £25m hit significant considering the financial impacts of the coronavirus, with Manchester United having not announced cuts for any of their players or staff. If Manchester United win their remaining Premier League fixtures, they will finish in the top 4 and seal Champions League qualification. The Red Devils have matches against Crystal Palace, West Ham and Leicester left.

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Manchester United Adidas deal: Red Devils won't have to pay £25m loss at once 

According to David Ornstein's report for The Athletic, Red Devils won't have to incur the £25m loss at once due to the structure of the Manchester United Adidas deal. The loss would be spread out across the five remaining seasons of the 10-year kit deal agreed in 2015, resulting in a £4.5million loss per annum to the revenue. Furthermore, Manchester United can also report it at a reduced value of £2.3million taking the entire life of the 10-year deal into account. That would mean that the Man United board could backdate the deficit, and would pay close to £11.5million in their 2019/20 accounts while receiving £2.3m less annually in each of the remaining five years of the Manchester United Adidas deal.

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(Image Courtesy: Manchester United Instagram)