A.S. Roma Sign’s Massive Shirt Sponsorship Deal, Share Price Drops with Semi-Final Leg 1 Loss

Roma

A.S. Roma has announced the largest sponsorship deal in club history, a 3-year pact (begins in ’18-’19) that will make Qatar Airways the club’s official shirt sponsor through the ’20-’21 season. The deal, worth $48.7 million/season (or +/- 2.5x the NBA’s most valuable patch partnership), is among the largest ever signed by an Italian futbol club. The logo of Qatar’s state-owned airline will “adorn the front of the first team’s shirts” and the company will serve as the top flight Italian soccer side’s “Main Global Partner.” Qatar Airways becomes just the 7th kit sponsor in the club’s 90-year history; the first team has played without a shirt sponsor since the ’14 season.

Howie Long-Short: Limited shares of A.S. Roma trade on the Borsa Italiana under the symbol ASR (OTC: ASRAF). Interestingly, the share price over the last 30 days has mirrored the first team’s success (or lack thereof) on the pitch. When the club stunned Barcelona (overcoming a 4-1 loss in Leg 1) on April 10th to advance to the Uefa Champions League semi-finals, the share price jumped 22% to $.73; by Tuesday morning it had risen to $.82. The team dropped the first leg of the semi-finals (to Liverpool, 5-2) on Tuesday afternoon and the share price began to dip in after-hours trading; by Wednesday’s close, shares were down -14.7% (to $.70) from Tuesday’s high.

While stock performance has little correlation with wins and losses in North America (see: MSG +48% since Oct. ’15, Knicks winning percentage over same span is .374, RCI hit a 5-year low during the Blue Jay’s first trip to the playoffs since ’93 in ‘15), it requires a closer look in Europe. Like Roma, MANU is having a strong season on the pitch ranked 2nd in the EPL standings; since the club’s August 12th EPL season opener, shares are up 14% (to $19.10). JohnWallStreet will take a deeper dive the correlation between on-field performance and the share price of publicly traded European clubs, in the coming weeks.

Fan Marino: ASR is playing in the Uefa Champions League semi-finals for the first time in 34 years, but the club is going to need a dominant performance (at least a 3-goal victory) on May 2nd (2nd leg), to qualify for the final. Of course, had the team not scored 2 late goals (they trailed 5-0 in Leg 1); all hope would have dissipated. For those wondering, Real Madrid and Bayern Munich are competing in the other semi-final; Real Madrid won the 1st leg 2-1 on Wednesday afternoon.

U.S. soccer fans will have a chance to catch A.S. Roma (+ Liverpool, Real Madrid and Bayern Munich) live in action this summer. Beginning on July 20th, 18 of the world’s top club teams will compete in the 6th International Champions Cup presented by Heineken. The event’s 27 matches are spread across 3 continents (North America, Europe and Asia), with 17 on U.S. soil; Roma will play in East Rutherford (NJ), San Diego and Dallas. You can find full schedule and ticket info, here.

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A.S. Roma Receives Approval for New Stadium Complex, Expects to Double Revenue

A.S. Roma has received approval to proceed with the construction of a long-delayed new stadium (Stadio della Roma) and entertainment complex, in the Italian capital; in the wake of the Italian National Team failing to qualify for the 2018 World Cup. Plans for the facility, first presented in ‘14 with the intention of opening for the ’16-’17 season, have been consistently delayed by environmental concerns and the public funding ($230 million+) required to complete $2 billion project; but, with the Italian government pushing for approval and a reduction in project’s scope (they won’t be building 3 proposed office towers), Roma finally received the go-ahead Tuesday. It is expected that the club will break ground on the new stadium next Spring.

Howie Long-Short: Jim Palotta, a co-owner of the Boston Celtics, is the Chairman and majority owner of A.S. Roma; but 22% of the franchise is publicly traded on the Borsa Italiana, the Italian stock exchange, under the symbol BIT: ASR. Forbes listed Roma as it’s 17th most valuable soccer club in the world (+12% YOY to $569 million) in 2017, despite the club losing $21 million on $242 million in revenue. The Atlanta Braves saw a 70% YOY increase in revenue, following their move in to SunTrust park. Pallotta has said that he expects Stadio della Roma to increase team revenues by more than 100%.

Fan Marino: Roma currently plays within a 72,000-seat stadium that it shares with rival Lazio; an outdated facility (opened in 1937) with a track that surrounds the field, placing the fans far from the action. The proposed facility, with a design inspired by the Roman Coliseum, will be an intimate 52,500 seat venue (that can increase to 60,000). As for the club, they won their Champion’s League Group on Tuesday (Real Madrid and Bayern Munich are potential 2nd round opponents), are trying to reach the quarterfinals for the first time since ’08-‘09 and currently sit 4th in the Serie A standings; Inter Milan is in 1st place and 5 points ahead.

Roma enjoying European success, new stadium approval

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