Under Armour’s plan to steal one of Nike’s biggest endorsements has failed.
The Baltimore-based company lost its bid for basketball star Kevin Durant over the weekend, ESPN reports.
Under Armour had reportedly offered the Oklahoma City Thunder forward between $US265 million and $US285 million, which would have been company’s biggest endorsement deal ever.
But Nike exercised its right to match the offer and Durant decided to stay with the company. The overall value of the new deal could amount to more than $US300 million, according to ESPN.
Excited and humbled to sign back with the swoosh!
— Kevin Durant (@KDTrey5) September 1, 2014
Under Armour’s offer was intended to widen its share of the basketball market, which now stands at less than 1%. By comparison, Nike is estimated to control 96% of that market.
“[Durant’s] one of the premier basketball players in the country,” Matt Powell, a retail analyst and owner of Princeton Retail Analysis, told the The Baltimore Sun. “Having him on board would give them additional credibility in their basketball category.”
The move by Under Armour came shortly after the company launched its largest-ever global women’s marketing campaign. And earlier this year, the company scored the biggest equipment deal in college sports.
Wall Street is betting on Under Armour’s ability to chip away at Nike’s empire. The stock is up more than 1,000% over the past five years.
But it is still considered a clear underdog. Under Armour has a market cap of just $US15 billion compared to more than $US68 billion for Nike.
The company has experienced massive growth over the past two decades, but its sales are still only a tiny fraction of Nike’s.
When Under Armour was founded in 1996, it had $US17,000 in revenue. This year, it is expected to bring in $US3 billion. By comparison, Nike is expected to bring in about $US28 billion this year.
Business Insider Emails & Alerts
Site highlights each day to your inbox.