- The Washington Times - Thursday, May 8, 2003

Sponsor bankruptcies no longer appear to be much of a problem in pro sports.The Baltimore Ravens yesterday announced a 15-year, $75 million agreement with Buffalo-based M&T Bank Corp. to rename their 5-year-old home facility in downtown Baltimore as M&T Bank Stadium. Despite a still-weak economy, the Ravens became the fourth major pro team in the last 16 months to lose its original stadium naming rights sponsor to corporate financial distress and replace it with a similar or better deal.Like the New England Patriots, Houston Astros and St. Louis Rams, the Ravens suffered national embarrassment when their sponsor, Herndon Internet company PSINet Inc., fell deep into financial distress and sought bankruptcy protection in 2001. Only two years earlier, PSINet had signed a then-record 20-year, $105.5 million naming-rights deal for the Ravens’ stadium.The Ravens, however, joined the Patriots, Astros and Rams by simply being patient — their search for a new sponsor lasted 15 months — and refusing to sell their naming rights at a discount. The $5 million payment the Ravens will receive from M&T each year will virtually match those made by PSINet, again giving the team access to one of the most critical revenue sources for any NFL team.Unlike general ticket sales and broadcast contracts, stadium naming rights revenue is not shared among NFL teams and can be spent in any fashion. The team last fall ignored a sizable fan push to have the stadium named after the late Johnny Unitas in order to regain that revenue.”The [Patriots, Rams and Astros] and their deals no doubt came into our thinking. But more fundamentally, we were definitely determined to get fair value, and we were determined this time to work with a company that has direct ties to individual consumers,” said Dennis Mannion, Ravens vice president of new business development and marketing. “That was probably the biggest change compared to our relationship with PSINet, which worked business-to-business.”After the Ravens and PSINet terminated their contract in February 2002, the stadium was known as Ravens Stadium, as it was during its first season in 1998.Industry executives were not surprised about the Ravens’ ability to match the annual value of the PSINet accord.”This is a team that is still competitive, though not quite on the level of years past, and is playing in a great stadium. This was a premier naming opportunity,” said Dean Bonham, a Denver-based sports marketing executive who has struck many naming rights deals, though not this one. “The two things going against them were the association with the old name, and the fact Baltimore is not the largest market out there. But the Ravens were still able to negotiate and get a price right among the upper echelon of NFL teams.”This rebounding does bode well for several other [NFL] teams still out there [seeking naming rights deals], such as Seattle.”Several other teams, including the Miami Dolphins and Tennessee Titans, have not been able to find replacements for their bankrupt stadium naming rights sponsors.The Ravens’ deal with 147-year-old M&T also continues a two-year trend toward teams making stadium naming rights deals with more stable companies. Once the province of upstart technology companies and airlines, stadium naming rights are now dominated by financial services and consumer products corporations, with a long-term presence on the Fortune 500 a near requisite.The high-profile financial fallout of numerous companies with naming rights, such as Enron Corp., TWA, and PSINet prompted the switch, even though the naming rights contracts in each case were mere fractions of their overall debt loads. Despite the corporate disasters and weak economy, the average value of stadium naming rights deals has remained on a steady upswing.Though M&T is a stable, profitable company — it registered a net gain of $485 million last year — the company is working to assert itself as a major player in American finance, particularly in the Mid-Atlantic. It recently bought Baltimore-based Allfirst Financial Inc. from Allied Irish Banks PLC for $3.1 billion and is now the 18th-largest bank in the country.The conversion of local Allfirst branches to M&T ones will take place in July, just before the Ravens play their first preseason home game with the new stadium name.Ravens management had initially sought a 20-year deal with payments of about $6 million, while M&T pushed for a shorter deal.M&T is planning on 350 million consumer impressions of its name through the deal, company officials said.”All banking is still local. We’re now a very big local bank, but this is a critical tool to invest in and become a part of Baltimore,” said Atwood “Woody” Collins III, president and chief operating officer of M&T’s Mid-Atlantic division. “There are a lot of layers to this relationship, and as a result, a lot of value to us.”


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