Mon 13 May 2024, 09:04 · Ash Harrison

Report: Castore founders 'embarrassed' by the one-sided arrangement they made with Newcastle United

Report: Castore founders 'embarrassed' by the one-sided arrangement they made with Newcastle United
Share Tweet

Newcastle United will soon cease their partnership with burgeoning sportswear manufacturer Castore as they shift over to a far more profitable deal with Adidas.

The deal that Newcastle's owners struck up with Adidas is the largest in the club's history and it completely dwarfs that of the current deal with Castore which was put in place during the Mike Ashley days.

As part of the deal with Adidas, Newcastle are bringing the retail side of the business completely in-house after Castore controlled all of that side of things. There's also an exclusivity agreement in place with JD Sports to stock and sell the Adidas kits. That arrangement means that Mike Ashley's Sports Direct will not be able to sell Newcastle United kits when the new Adidas stock hits shelves, something that is not sitting well with our former overlord who has taken the club to a tribunal citing that it is anti-competitive.

The Competition Appeal Tribunal (CAT) threw out the case saying that Sports Direct had 'no legitimate reason' to continue selling Newcastle United merchandise. However, Mike Ashley wasn't going to just let it go and has since launched an appeal which, probably isn't going to go his way either.

Screenshot 2023 12 30 143531
Footy Headlines
Coming soon

Things don't seem to be going well for Mr Ashley

The appeal was heard on Thursday and the details around the current deal with Castore were once again brought to light. It shows just how little Mike Ashley cared about the club, farming everyone out to third parties with no care for whether it made money for the club as long as it improved the Sports Direct bottom line.

The Chronicle revealed that Thomas de la Mare, the barrister representing Newcastle highlighted the one-sided nature of the agreement with Castore saying that the sportswear manufacturer were granted exclusive production, sponsorship, retail and distribution rights for all club-licensed products, including the kit, apparel and accessories, as well as non-sports products such as bed linen. He then went on to clarify that there was 'exclusivity seemingly unpaid for which Sports Direct enjoyed' and that there was no right for the club to receive any sales royalty or sales data.

Newcastle's Chief Commercial Officer, Peter Silverstone was quoted by Mr de la Mare as saying:

"There were plainly elements of cosiness in the relationship between Castore, Sports Direct and the club at the time Sports Direct owned the club"

"There are two aspects to that. The first, explained in Mr Silverstone's evidence, are the fairly strange terms of the rights accorded to Castore, which seem to be uncommercial in a number of respects.

"If we want to play the game of unchallenged evidence, there is unchallenged evidence that the founders of Castore have said that they are effectively embarrassed by the arrangements, because they appeared one-sided, but they suited Sports Direct."

You know you messed up when a corporation feels bad for ripping you off

When a business feels guilty about the unfair balance of the division of funds, you know something is awry.

Newcastle's deal with Castore will end this month with Adidas taking over at the start of June with the new home kit set to be revealed in the first week.

You will not be able to buy the new kits from Sports Direct which is just fantastic.