Nike scores with Umbro takeover

A photo combination shows England and Manchester United footballer Wayne Rooney (L) wearing a Nike sponsored Manchester United training jersey and England and Newcastle footballer Michael Owen (R) modelling an Umbro Performance Perfected shirt. US sportswear giant Nike ventured further into the British football market on Tuesday after agreeing to buy rival Umbro, maker of the England soccer strip, for 582 million dollars (408 million euros).

US sportswear giant Nike ventured further into the British football market on Tuesday after agreeing to buy rival Umbro, maker of the England soccer strip, for 582 million dollars (408 million euros).

The cash bid, worth 195 pence per Umbro share, values the British group at 285 million pounds, a joint statement said. The offer represents a premium of about 61 percent to the closing price of 120 pence per Umbro Share on October 17.

At the close of London trade Tuesday, Umbro's share price stood at 190.25 pence, up 15.30 percent from Monday's finish.

"We are fully committed to helping Umbro reach its full potential and we are delighted that Umbro's board is unanimous in its support of our offer," said Nike president and chief executive Mark Parker.

Nike, which makes the football kit for the Brazil national team and English Premiership clubs Manchester United and Arsenal, is purchasing a group which also provides sportswear for the Norway, Republic of Ireland and Sweden football squads.

High profile players endorsing the Umbro brand include England and Chelsea captain John Terry and his national team-mate Michael Owen.

"This is an excellent deal for all our stakeholders," Umbro chief executive Steve Makin said of the Nike offer.

"It provides great value for shareholders and exciting prospects for our colleagues, partners and customers around the world."

Nike's offer is subject to approval by Umbro shareholders and regulatory bodies. The US group's approach already has the backing of English football's governing body, the Football Association, which has worked with Umbro for more than 20 years.

FA chief executive Brian Barwick said: "Nike has provided firm assurances that the FA relationship with Umbro will be protected and enhanced, and we look forward to working closely with both companies moving forward."

Nike has expanded aggressively into the football market over the past few years and aims to become the world's leading football brand by the 2010 World Cup in South Africa.

Takeover speculation last week caused Umbro shares to rocket, boosting investors while fans were picking over the national side's 2-1 defeat to Russia which makes qualification difficult for the 2008 European Championships.

Nike intends to operate Umbro as a stand-alone affiliate brand in the same way as Converse, which the Beaverton, Oregon-based firm acquired in 2003.

Earlier this year, German sportswear manufacturer Puma was bought by French luxury goods empire PPR. In 2006, Puma's German rival Adidas took over US sportswear group Reebok.