Mike Ashley said Sports Direct paying this for Newcastle United advertising – Shock new claims
December 2021 saw Mike Ashley begin legal proceedings against Amanda Staveley.
The former Newcastle United owner claiming that the member of the consortium now owning the football club, had broken the terms of an agreement.
That agreement saw Mike Ashley loaning Amanda Staveley £10m to cover costs incurred in the takeover transaction and Ashley now demanding immediate repayment because he claims Ms Staveley broke certain conditions on which the loan was made.
The Mail are now reporting that they have seen papers filed to the court by Amanda Staveley in response to Mike Ashley’s legal action, with some very interesting claims made regarding Ashley and what his Sports Direct / Frasers did (or didn’t!) pay for the overwhelming promotion of his retail empire…
‘Details of sponsorship payments to Newcastle from Sports Direct and designer fashion chain Flannels – another Mike Ashley firm – have also been disclosed by Staveley’s lawyers.
They claim the new owners discovered only after the transaction that Newcastle had ‘not received any sponsorship fees in respect of the Sports Direct or Flannels signage for the 2019/20, 2020/21 or 2021/22 seasons’.
The issue of sponsorship rights was first mentioned in Ashley’s claim in December. In that, he said Newcastle’s new owners prematurely terminated an agreement with Sports Direct.
He said Staveley rowed back on an alleged assurance that she would ‘endeavour insofar as possible’ to maintain Sports Direct’s sponsorship deal until the end of the 2021-22 season in May. A month after the acquisition, Staveley told Ashley that the sponsorship would end.
Correspondence shows that Ashley unsuccessfully tried to prolong Newcastle’s notice period to terminate Sports Direct’s sponsorship rights from 14 to 90 days.
Staveley has said the decision to end the sponsorship was in part due to the high street retailer ‘not paying any fees’ in return for its rights.
Legal papers state ‘there was self-evidently no commercial benefit in retaining the Sports Direct or Flannels signage’.’
So, for Newcastle United fans, the key claim from Amanda Staveley is that ‘Newcastle had ‘not received any sponsorship fees in respect of the Sports Direct or Flannels signage for the 2019/20, 2020/21 or 2021/22 seasons’.’
Obviously it will be for the courts to decide what happens between Mike Ashley and Amanda Staveley BUT I think it is realistic to assume, that the claim of no payments made by Sports Direct (Frasers) / Flannels for sponsorship / advertising for these three seasons are true, because a bit daft to claim so if not, as Mike Ashley would easily be able to point to when and where the money was transferred.
Anyway…what I do think is VERY interesting, is to see what the history of this Sports Direct ‘sponsorship’ is, with in particular what Mike Ashley previously stated would be the case, in terms of payment from Sports Direct to Newcastle United…
If we go back to Friday 26 July 2019, Mike Ashley stated in the Sports Direct accounts:
“In the current and prior year we have in the ordinary course of business been charged £1million per season for advertising rights whilst Newcastle United are in the Premier League, this is covered in the related party note in the financial statements.
“For the football season beginning in August 2019 the Sports Direct Group will be charged £2million for the advertising rights.
“Sports Direct still considers this to be value for its shareholders.”
So, did Sports Direct / Frasers pay £2m for the 2019/20 (and for 2020/21 and 2021/22) as Mike Ashley claimed would be the case, or was not a penny paid as Amanda Staveley states?
Hmmm, who to believe?
The Sports Direct and Newcastle United relationship had been very much a case of smoke and mirrors. A tangled web totally lacking in transparency.
As well as absolutely nothing paid for most of the Mike Ashley ownership years by Sports Direct for advertising at Newcastle United (until a relative pittance was paid for a small number of seasons), there was never any true clarity / transparency about what exactly, if anything, Newcastle United benefited from the retail ‘partnership’ between Sports Direct and the official NUFC club shops. Certainly no breakdown ever made public.
Things of course reached an all-time low (high for Mike Ashley and Sports Direct), when shamelessly he renamed St James Park in favour of his retail empire, with not a single penny paid into the club in return.
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