Adidas Signs 11-Year, $400 Million Deal With NBA

Basketball Playground Is Key Battleground With Rival Nike

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NEW YORK ( -- Three months after its $3.8 billion Reebok acquisition, Adidas and the National Basketball Association inked an 11-year global merchandising deal to make Adidas the official uniform and apparel provider for the NBA, the Women's National Basketball Association and NBA Development League.

Executives close to the deal pinned the contract at $400 million, far exceeding the 10-year, $250 million contract Reebok signed with the NBA in 2001.

All apparel except uniforms
With the exception of the actual team uniforms themselves, beginning in the 2006-07 season Adidas will get its logo on all NBA apparel, including warm-ups. Reebok had a similar deal. Adidas will also be able to have its logo on WNBA and NBDL team uniforms.

Reebok is also the uniform and apparel provider for the National Football League in a $250 million deal signed in 2001, but league spokesman Brian McCarthy said, "We continue to operate under the terms of our existing agreement with Reebok."

Said Adidas brand CEO Erich Stamminger: "There are no plans to switch them over to Adidas."

For Adidas, the NBA deal was another strategic move in its quest to close the North American gap with rival Nike, which owns 70% market share in the U.S.

"We have some key categories in our sports performance division and one is soccer and one is basketball. If you want to be the leading sports [company] in the world, you have to lead in basketball," Mr. Stamminger said. "This is a new dimension for our growth in basketball. We've invested heavily in basketball the last two years [with individual player endorsements]. Now with the NBA, it's a new platform and new dimension and we will use it."

Basketball's global reach
The NBA has always had the biggest global reach of the major professional team sports based in the U.S., and both Mr. Stamminger and NBA Commissioner David Stern made reference to the burgeoning Asian market.

"Adidas has 2,100 retail stores in China," Mr. Stern said. "This is a major step forward for us."

Both Reebok and Nike will be able to continue to sign individual endorsement deals with NBA players. Reebok endorsers include Allen Iverson and Yao Ming; Nike's top basketball endorser is superstar LeBron James. Adidas has deals with Tracy McGrady and Kevin Garnett.

Shares of Adidas rose 3% in Frankfurt to $208.81 after the deal was announced overseas this morning.
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