University of Louisville celebrates new $160 million Adidas contract
The University of Louisville on Friday confirmed a 10-year contract extension with Adidas that gives the school the fourth-richest apparel agreement in college sports.
The deal is worth $160 million, or $16 million per year, as reported Thursday night after athletics director Tom Jurich revealed the new agreement at a dinner with administrators and boosters.
U of L announced the terms of the extension Friday before holding a pep rally for administrators, coaches, staff members and student-athletes in the academic center at Papa John's Cardinal Stadium.
"(It's) an unprecedented deal from our university's standpoint and an unprecedented deal for Adidas," Jurich told the crowd during his opening remarks at the rally.
U of L's new contract runs through the 2027-28 academic year and goes into effect July 1, 2018. according to a copy of the agreement obtained by the Courier-Journal through an open records request. Adidas started sponsoring Louisville in 1998.
Louisville will receive $10 million in base compensation from Adidas between 2018-21, and then $7 million per year from 2021-28, the contract says. Those are significant increases over the current contract, which has a maximum base compensation of $1.575 million that is due over this coming academic year.
The deal also includes $3 million in activation fees from 2018-21 and then $1 million from 2021-28. Those funds should be used for U of L's athletics marketing internship partnership with Adidas and "strategic brand initiatives," the contract stipulates.
Adidas will provide U of L with $6 million in what it defines as "Adidas products" over the next two years, then $6.1 million from 2020-23, then $6.2 million from 2023-28.
The performance bonus structure appears to be the same that it was in the 2014 apparel deal, with the basketball team earning $300,000 for a national title and $150,000 for a Final Four appearance. The football team would earn a $300,000 bonus if it won the national title and $100,000 if it reached the College Football Playoff.
Women's basketball would get $200,000 for a national title and $75,000 for a Final Four appearance.
Each team would also earn smaller bonuses for ACC titles or coach of the year honors.
"We've spent the last 18 months trying to do a deal together and come out with new innovations," Jurich said, "but we haven't really settled on a plan. We'll figure that out."
More on U of L's Adidas contract
It was the latest blockbuster deal in a series of new apparel contracts that have significantly upped the money involved in college sports sponsorships.
Nebraska's board of regents two weeks ago approved the school's 11-year, $128-million extension with Adidas, making the Cornhuskers now the apparel company's second-leading client behind U of L.
Miami (12 years, $93.6 million) and Texas A&M (eight years, $56.8 million) are third and fourth.
After UCLA left Adidas last year and signed a 15-year, $280-million contract with Under Armour, Jurich told the Courier-Journal that he expected U of L to be in a "very, very good, strong position" to renegotiate a new apparel deal.
The Cards' new contract gives them the most lucrative brand sponsorship in the ACC.
"We're proud this will be our largest commitment in the college space," said Chris McGuire, the senior director of sports marketing for Adidas North America.
The previous deal between Adidas and U of L included accessories, footwear and uniforms, plus investments in advertising, equipment rooms and digital and video technology. The contract also set up a scholarship and internship program for up to 23 U of L students to work in branding, marketing or other areas of the athletics department.
Like Jurich, McGuire did not get into specific details of the updated contract. He said the two sides are working their way through the weeds of the agreement.
"It's not vague," McGuire said. "It's just that our product timelines are 12 months in advance, so we have a lot of work to do on our end to bring those products to market. It's a long process for releasing products. There's a lot of concepts that are out there, a lot of different ideas, just not anything that's ready to come to fruition yet."
More U of L headlines
Louisville's new deal comes at a time when tensions around the university have heightened in the wake of a stinging forensic audit, a reworked KFC Yum Center lease agreement and the NCAA's Committee on Infractions ruling in the men's basketball case.
Asked if the extension eased some of his frustrations over the new Yum Center lease, Jurich flatly said no.
“I really haven’t looked at it that way," he said. "I really haven’t. I think it’s just more of a win for the student-athletes."
The previous contract included a clause that allowed Adidas and U of L the right of "first dealing and first refusal" 180 days before the beginning of the final year of the deal.
"It's 20 years in the making to be where we are today," McGuire said. "... We love the trajectory of where athletics here is going."
That was the chord Jurich struck Friday, too, saying the deal was the perfect start to U of L's new marketing campaign, "We, the Future."
"I think," Jurich said, "this will probably register as good news."