Investing.com -- The National Basketball Association announced on Wednesday that it has formed an eight-year partnership with Nike (NYSE:NKE) to become the league's exclusive oncourt apparel provider starting with the 2017-2018 season.
Under the agreement, Nike will become the league's first apparel partner to have its logo appear on NBA uniforms. Nike's omnipresent swoosh logo will also appear on warm-up jerseys, as well as shooting shirts. In March, Adidas (XETRA:ADSGN) announced that it would not renew an 11-year deal valued at approximately $400 million. In 2014, Adidas controlled less than 3% of the U.S. basketball shoe market dominated by Nike.
"This partnership with Nike represents a new paradigm in the structure of our global merchandising business," NBA commissioner Adam Silver said. "As our exclusive oncourt apparel provider, Nike will be instrumental in our collective efforts to grow the game globally while applying the latest in technology to the design of our uniforms and oncourt products."
With the partnership, Nike will also take on an expanded role in marketing efforts with the WNBA and the NBA Development League. Last year, Nike's iconic Jordan Brand generated more than $2.5 billion in revenue for the company. Converse, which was purchased by Nike in 2013, earned more than $1.3 billion in 2013 – representing roughly 6% of Nike's company sales.
"We're excited to bring the full power of our global reach, innovation and creativity to partner with the NBA and grow the game in a way only Nike can," said Nike, Inc. president & CEO Mark Parker said in a statement. "In Nike, Jordan and Converse we have three of the most connected brands in the world, and look forward to making the global growth of the game a successful strategy for both the NBA and Nike."
Before Wednesday's announcement, Nike already had endorsement deals with LeBron James, Kevin Durant, Kobe Bryant and Paul Pierce among others.
Shares in Nike inched up 0.51 or 0.49% to 103.81 in after-hours trading.