Nike has signed Cleveland Cavaliers forward LeBron James
to a lifetime deal in what one source familiar with the negotiations
said is the largest single-athlete guarantee in company history. The
world’s largest sporting goods company signed the four-time NBA MVP to
an unprecedented lifetime contract on Monday. Terms of the deal weren’t
released, but sports agent David Falk, who represented Michael Jordan
for most of his playing career, estimated its value at $400 million to
$500 million.
Nike said in a statement that the 30-year-old Cleveland Cavaliers
forward provides “significant value to our business, brand and
shareholders.”
Nike signed
James after he went pro out of high school in 2003. His first contract
spanned seven years and was worth $90 million, according to ESPN, with a
seven-year extension in 2010. Nike has released at least 13 versions of
James’s signature shoes.
What kind of return does Nike get from
the deal with James? That depends how you measure, said Matt Powell, an
analyst at research firm NPD Group. If you go by what James brings in
through sales, versus what they’re paying him, Nike is probably losing
money, he said.
“But he’s the face of the brand, and he’s the most popular player in the league, so it makes sense,” Powell said.
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