Mark Baber
July 1 – Evonik and Borussia Dortmund (BVB) have made a joint-announcement that their partnership will be broadened and extended to 2025, with chemicals manufacturer making a cash injection of €26.7 million for a 9.06% stake in the club and extending its sponsorship agreement from 1 July 2014 to 30 June 2025.
The shirt sponsorship deal is seen as unusual as Evonik is not a customer-facing brand, but it has been welcomed by analysts as the share purchase is at a favourable price for Evonik and provides BVB with the considerable financial resources and long-term stability.
BVB’s Managing Director Hans-Joachim Watzke said: “Through our recent success in the Champions League, BVB has the ability to help drive the success of Evonik’s international brand-building process.
“In future we will have a presence in Asia – where Evonik has been present for many years – and will be building up a BVB representative office in the region. At the same time, the new sponsorship agreement and Evonik’s stake in BVB mean we will be consistently able to field top players both in Germany and abroad. That is both a pleasure and an obligation for us.”
Klaus Engel, Chairman of the Evonik’s Executive Board, commented: “We are forging an alliance of strength between two partners in Germany’s Ruhr region that both stand to benefit from and promises strong international appeal. We know what we mean to each other and we know that together we can still derive many benefits.
“BVB’s black-and-yellow colours stand for professionalism and passion. That already brings a good deal of brand empathy and brand awareness for our brand as well. Evonik and BVB have a joint message for fans and friends, and for their competitors: Our success story is set to continue.”
According to the joint press release, brand recognition amongst financial and business decision-makers, a particularly important target group for Evonik, is 95%, with 74% associating Evonik with BVB. The sponsorship of a football club to reach this target group is unusual but clearly considered effective by Evonik with Engel commenting that the sponsorship “enables us to reach key target groups such as customers, specialists and investors in many countries.”
Ruhr valley based Evonik, makes high-tech plastics, animal feed additives, absorbers used in diapers and clear acrylic sheet and its investment in BVB follows similar corporate deals involving BVB’s main rival Bayern Munich. The share deal values the club at 1.2 times next year’s sales and 5.8 times next year’s earnings (before interest, taxes, depreciation and amortisation) according to Thomson Reuters data.
The total value of the sponsorship deal has been estimated by local media as being up to €300 million.
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