VIRGIN MONEY was revealed as the new shirt sponsor of Barclays Premier League club Newcastle United this week, four days after the company officially took control of previous shirt sponsor, Newcastle-based bank Northern Rock.
Northern Rock had been the principal sponsor of the Magpies since 2003 and was contracted to sponsor the team until the end of the current season. It was initially thought that the agreement would remain in place before the club sought a new sponsor in a combined shirt and stadium naming rights deal for around £10m per season.
This plan of action, as outlined by the Newcastle United owner Mike Ashley, now seems to have taken a backseat with Virgin Money assuming the terms of the existing Northern Rock agreement for the rest of the season, and signing a new deal for a further two years through the 2013/14 season.
While various reports value the Virgin Money deal at up to £10m per season, Frontloaded suggests it is more likely to be similar to the value of Northern Rock’s four-year deal, which was around £2.5m per year.
While there is no mention of a naming rights agreement tied into the Virgin Money sponsorship it is unlikely that Ashley’s commercialisation plans for the stadium have gone cold. Currently known as the Sports Direct Arena, Ashley could well be looking to market the naming rights for a discounted rate of around £6m-£7m per season, given the shirt sponsorship is currently no longer a feature of the original £10m annual price tag.