Sunderland's contentious sponsorship deal with 'Invest In Africa' has hit problems. Amid some confusion, the club's lucrative deal has been cancelled, with the club suggesting the split is 'by mutual consent'.
Back in July 2012 I wrote an article about Sunderland's new sponsor 'Invest in Africa' - a 'non-profit organisation' backed by Tullow Oil. At the time, many people were surprised by the size of the sponsorship deal which reported as being 'worth £20m a season'. This was a significant increase in the club's previous deal with the Tombola Bingo/gambling company which was worth around £1m to the club.
When the original deal was struck, environmental campaigners alleged that 'Invest In Africa' was a 'PR front' for Tullow Oil, a company accused of striking shady deals with Ugandan government officials and of depriving locals of their fishing grounds.
Tullow are now mired in a potentially hugely-damaging court case in Uganda and are accused of bribing officials in return for oil-exploitation rights. The magazine Foreign Policy recently accused the company of having a “a complete absence of corporate social responsibility". Shortly after the issue blew-up, David Milliband resigned from his post on the board at Sunderland, citing De Canio's admiration of fascism as the reason. Since then, the campaigning website Platform has published a piece suggesting that the Tullow court case was the greater driver for Milliband. This triggered a extremely interesting piece of investigative journalism from the BBC who produced this short news report on the Tullow issues as they affected Sunderland (I would recommend you watch it).
Upon launching Invest In Africa,Tullow announced that they planned to bring five other major partners to the Invest In Africa initiative and that it would not succeed if they did not acquire other collaborators. Tullow spokesman Cazenove advised that "there will be other partners, significant companies, household names from various sectors, and soon". Nine months on, and with just one additional partner, Invest In Africa doesn't appear to have worked as intended - it seems likely that it is Tullow rather than Sunderland who have pulled the plug on the shirt sponsorship deal.
When the deal was cancelled, the club announced that the contract had always had a one-year review/break agreement. Howeverreports suggest that Tullow were considering pulling the deal even before the De Canio appointment. Would Sunderland really cancel a £20m a year deal when it had recently announced a £26m operating loss? It is interesting to note that the club don't yet have another sponsorship deal in place - they announced that there is a deal in the pipeline but it would be dependent on the division the club is in next season. Cancelling a highly lucrative deal, when there is no guaranteed replacement, does seem rather unusual. I should point out that there are suspicions that the headline '£20m' sponsorship is probably not quite as it first appeared and that, although sizeable, it may have brought in somewhat less than the quoted figure (i.e. it was linked to Premier League/Cup success and UEFA qualification).
To add to the rather unclear picture, Sunderland recently entered into an association with the Nelson Mandela Foundation and have committed to raise funds for the organisation as part of the club strategy for growing their 'brand' in Africa. Sunderland hope to seal a new sponsorship deal with an African company (although it would be fortunate to sign a replacement contract as lucrative as the Tullow/Invest In Africa deal).
Just as managers never truly leave a club 'by mutual consent', there is likely to have been one party driving the divorce. This leaves us with some unanswered questions; did Sunderland take a highly principled decision and end a lucrative contract, following allegations against Tullow; or did Tullow end the deal following lack of interest in the initiative from other partners? Although it appears that Tullow ended the deal, if it transpires that Sunderland did take the lead and act out of principle they should be applauded. However, without more information from the club it is hard for fans to know whether to cheer or jeer.
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