Standard to end its sports sponsorships

Standard Bank has confirmed it will end its sponsorships agreements with Cricket South Africa (CSA), Kaizer Chiefs and Orlando Pirates when current contracts expire in May 2011.

The bank is on a drive to cut costs. Last month it announced plans to retrench more than 1300 permanent staff and 700 contractors in its South African and London operations.

Friday's confirmation brings to an end a 13-year sponsorship agreement with CSA and a 10-year partnership with Kaizer Chiefs and Orlando Pirates.

The group said due to "changing business priorities" it has decided to end its sports sponsorship contracts as part of the effort to improve efficiencies across the group.

Sarah-Anne Orphanides, group marketing and communications director, said it was a difficult decision as the bank had made significant investments in soccer and cricket.

Standard Bank's move is similar to that of AIG in Europe, which ended its sponsorship of Manchester United in the midst of the global credit crunch.

Manchester United received about $19-million per season from AIG.

It is understood that Standard Bank's sponsorship deal was worth about R65-million to each soccer club over the three years.

Gillian Saunders, director at Grant Thornton, said it has been a noticeable trend globally for banks to cut back on the sports sponsorship because of the recession.

Standard Bank is not the only bank cutting ties with sports teams. Last month Absa Group terminated its 11-year partnership with the Durban-based rugby team, the Sharks.

Sasol will end its sponsorship of Springbok rugby at the end of this year.

Kaizer Motaung, Kaizer Chiefs' executive chairman, thanked the bank for its support while Gerald Majola, CSA chief executive, said "significant investment in the game leaves cricket in a very healthy state".

All is not lost for the soccer clubs. Cellphone company, Vodacom, another major sponsor to the Soweto football giants, has about R200-million to spend on each club over three years.