Newcastle United F.C. revealed it has agreed on an extension of its shirt sponsorship deal with a gambling operator at a time when the English Premier League (EPL) is expected to give the green light to a sovereign wealth fund based in Saudi Arabia to purchase the club.
As the football club itself has shared, it has renewed its sponsorship agreement with Fun88, an online gambling operator based on the Isle of Man. Currently, the company does not hold an operating licence issued by the UK Gambling Commission (UKGC) but is present on the UK gambling market through a third-party technology provider.
The extension of the gambling sponsorship deal comes in spite of the sale agreement that was reached in April between owner Mike Ashley and a consortium led by the Public Investment Fund based in Saudi Arabia. It was also confirmed by the managing director of Newcastle United, Lee Charnley.
According to a source with knowledge of the terms of the deal, the previous three-year sponsorship agreement between Fun88 and Newcastle United was estimated at approximately £6 million on an annual basis. Now, its extension comes at a time when the presence of gambling operators as football and other sports clubs’ sponsors is facing a lot of criticism and is under intense regulation from gambling watchdogs, as anti-gambling campaigners have shared fears that they could encourage children to start gambling.
Could Extended Shirt Sponsorship with Fun88 Jeopardise the Football Club’s Takeover?
The extension of the sponsorship agreement with Fun88, however, puts the football club’s acquisition deal under question. Currently, gambling is fully banned in Saudi Arabia, where gambling laws are extremely strict and their violation could lead to an imprisonment sentence.
After the announcement of the sponsorship deal expansion, the gambling company Fun88 shared that it was willing to make its brand more popular, improve its fan engagement and reach new audiences. The operator further noted that it is mainly focused on gamblers from Asia but it was still willing to boost its customer base in the UK. Fun88 also explained that the agreed acquisition of the football club from the Saudi Arabia’s Public Investment Fund was not a matter of its competence and refused to make more comments on whether the terms of its sponsorship deal with Newcastle United would remain unchanged in case the club changes its ownership.
As reported by the Financial Times, Newcastle United F.C. has so far refused to comment on the terms of the agreement.
According to the sports marketing agency Two Circles, spending on global sports sponsorship deals is expected to suffer a $17-billion decline to $29 billion in 2020, boosting the pressure on sports clubs and leagues that have already been experiencing financial difficulties as a result of the coronavirus pandemic outbreak. For the time being, gambling operators have been among the few sports clubs sponsors that have been relatively resilient to the financial difficulties, as online gambling services are on the rise even at a time when sports fixtures have been postponed because of Covid-19.
On the other hand, however, anti-gambling campaigners have called for the Government to impose a ban on football shirt sponsorships due to fears that such agreements may make gambling look normal to underage individuals and push them to gambling. As Casino Guardian has already reported, in the 2019/2020 season, half of EPL clubs have a gambling operator as a sponsor, and so do 17 of the 24 clubs in the English Championship.