7:17 am, June 21, 2023
Cazoo has tried to use a racism row to pull out of a sponsorship deal with Valencia CF football team, but has still had to fork out €1m for the remaining 12-month partnership.
The online used car dealer signed a multi-year agreement worth €4m a year with Valencia CF in February 2022, but has since tried to back out of the agreement, according to Spanish media.
The sponsorship saw Cazoo become the football club’s main partner and shirt sponsor, with the Cazoo name displayed on the men and women teams’ shirts, and it having ‘significant visibility’ on TV coverage and ‘all digital platforms’, the firm said when the deal was inked.
However, since then, Cazoo has suffered a much-publicised withdrawal from continental Europe with the closure of many businesses and the axing of sponsorship deals.
The European exit is part of a ‘realignment plan’ outlined in January this year as it seeks to shore up its future beyond April 2024 and concentrate on its core UK used car business.
According to Football Espana, Cazoo tried to back out of the multi-year agreement, saying it was withdrawing all sponsorship deals within continental Europe.
The football club, however, won a court battle preventing Cazoo from terminating the sponsorship agreement.
But, in recent weeks, Valencia CF has been embroiled in a bitter racism row, with the club calling on rivals Real Madrid and their forward Rodrygo to withdraw claims that their football supporters aimed racist chants at Real Madrid player Vinicius Junio, or face legal action.
Three Valencia fans have since been charged over racist abuse towards Junio, while Spanish football at large has received calls to introduce tougher measures to combat racism.
According to media reports, Cazoo tried to use the ongoing racism row to again back out of its Valencia sponsorship deal, claiming the incident has harmed Cazoo’s corporate image and issued a legal letter to the team.
It’s now believed Cazoo has settled to pay out €1m for the remaining year’s contract, instead of the original €4m.
Cazoo didn’t confirm or deny the reports, telling Car Dealer: ‘Cazoo has terminated its sponsorship of Valencia by mutual agreement with the club and under terms agreed by both parties.’
Cazoo lost £839m last year on revenues of £1.24bn.
Shares were trading at a low of $1.27 yesterday – close to the $1 limit the NYSE requires firms to maintain to keep their place on the exchange.
