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Adding Insult to $2.7 Billion Injury: AIG Is Off Man United Kit

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AIG found itself in the news on August 6 when it posted a $2.7 billion loss for the second quarter of 2010. On August 8, in perhaps even worse news for the company, AIG was missing in action on the soccer pitch as Manchester United, the world’s most valuable sports franchise ($1.8 billion, as measured by Forbes, with an estimated 130 million “core” fans worldwide), was victorious in the traditional opening of the English Premier League at New Wembley Stadium in northwest London, besting Chelsea 3-1 in the annual friendly charitable match known as the Community Shield.

AIG had appeared prominently on the front of the Manchester United players’ shirts since 2006, with various British newspapers saying AIG paid about $25 million annually to be only the third corporation to appear on the front of the Man U jersey for four years. After lending $130 billion to keep AIG afloat, the U.S. government apparently decided not to renew the sponsorship deal when it came up for renewal this year.

Instead, Aon (NYSE ticker: AON), the Chicago-based risk management, reinsurance, and HR consulting firm, now appears on the Man U. “kit” in another four-year deal that was kicked off in June 2010 with a global charity initiative; apparently Aon also gave one of the new Manchester United shirts to each of its 36,000 employees. The British papers say Aon is paying about $33 million per year for the privilege of sponsoring the shirts.

Chelsea, which won the Engligh Premier League last year, is ranked as the 9th most valuable soccer club in the world by Forbes, at $646 million. Another EPL club, Arsenal, which finished third in the EPL last year (behind Chelsea and Manchester United), is the third-most valuable soccer (i.e., football everywhere else in the world but in the U.S.) sports franchise in the world, according to Forbes, at $1.18 billion. The “value” of a team is defined by Forbes as a team’s equity plus its net debt. The second most valuable franchise in the sport is Real Madrid, worth an estimated $1.32 billion.

The second most valuable sports franchise in the world, according to Forbes, is the NFL’s Dallas Cowboys, at $1.65 billion, followed by the New York Yankees ($1.60 billion), Washington Redskins ($1.55 billion), and New England Patriots ($1.36 billion).

On August 6, the New York Times reported that AIG’s chief executive said in an interview that the company had begun talks with the federal government on how to speed up repayment of the $130 billion that the government lent to AIG. The Times quoted Robert Benmosche, AIG’s CEO, as saying: “We’ll make sure taxpayers get paid back in full, and they will…They’ll get paid back at a profit.”

At the time the AIG sponsorship was announced in 2006, David Gill, then as now CEO of Manchester United, said, “Our goal was to find an organization with the right pedigree. One that was hungry to be involved with us. One that had ambitions that match ours. And one that could take full advantage of United’s unique global reach. And we’ve found one.”