Lacrosse Industry Rumblings: Nike Buying Under Armour?

Nike Lacrosse Syracuse
Nike is already well established in lax... and everywhere.

It’s been reported that Nike is contemplating the purchase of Under Armour, and the lacrosse world is definitely buzzing about this prospect.  Some see it as a good move, others not so much.  Some think it will never happen, while others are hopeful that it will come to fruition.  This is obviously bigger than just lacrosse, but what would this move mean for the lax world?  And could it actually happen?

I’ll start with the latter question first.  Yes, it could actually happen.  Nike, along with the rest of us, has seen Under Armour make big strides in apparel, and now footwear.  Under Armour is big, but Nike is bigger, and they definitely have the money and power to buy UA.  If they did, it would most likely be like GM buying Cadillac or Buick, or Warrior buying Brine, at least in the sense that they would keep the “competitive brand” alive.  Under Armour has pull with consumers, and Nike probably wants that pull.  Because a more diverse pull is good, right?

Another reason that I could see Nike purchasing Under Armour is UA’s recent push into more sports, equipment manufacturing, and wild uniforms.  Nike got into lacrosse in a major way right before UA did with an apparel push and new equipment.  Nike has also taken Oregon Football to new levels with their crazy uniforms.  And now UA is doing all of that as well.  So the new question seems to be, do you invest in, and try to control, something new and popular that does what you do?

Nike Lacrosse Syracuse

Nike is already well established in lax... and everywhere.

Because of this popularity, Nike may be forced to pay a premium for Under Armour, but the investment could definitely prove worthwhile, especially if UA continues to be as popular with new consumers as it has been in recent years.  Basically, Nike has to be thinking that Under Armour is gunning for them, and using very similar marketing and design approaches, so buying them now could eliminate a future threat to their sporting goods dominance.  And buying now is better than paying through the nose later.  So to a certain extent, the move makes a lot of sense.

On the other hand, the move might not happen for a number of different reasons.

To look at it simply, Nike is a HUGE entity, and they probably aren’t all that worried about Under Armour.  The purchase would be an investment.  And like any investment, Nike will have to look at what else they could do with the money.  Could they reinvest the investment in themselves and make their company that much better, and valuable?  If so, the UA deal probably won’t go down.  Nike could easily choose to not go through with it.

Maybe Under Armour just isn’t going to sell.  Jay Hancock, of the Baltimore Sun, seems to believe that the deal won’t happen.  He says the the Plank brothers own 29% of the company and that is enough to prevent a sale.  Basically, he says it all rests on them.  And they know what they’ve got, and simply won’t want to give it up.  He also mentions that they are doubling the size of their headquarters, and that a move like that doesn’t sound like people who are interested in selling.  But Maverik was in the middle of moving their offices to better space when the Bauer deal was announced, so I’m not putting as much stake in the latter fact as Mr. Hancock is doing.

Since Kevin Plank (the founder) owns 24% of the company, he has the most to gain with a sale, but he also has the most to lose.  He could reap a serious windfall with a sale, but by holding on to the company, and expanding and improving, he might be in a for an even bigger windfall down the road.  If he is motivated by money only, I can’t see the sale going though, but only because there is so much MORE money at play further along.

Hancock also makes the point that Nike is enemy number 1 for Under Armour, so why would they ever sell to them?  The answer to that is actually simple: money.  If you’re down to sell out, you’ll do so with anyone, as long as the price is right.

One of the commenters on the Bmore Sun quickie post points out that entrepeneurs grow tired of day to day operational management and while this is genrally true, I’m not so sure it applies here.  UA is the first major successful business the Planks have started, and being that it’s related directly to Athletics, and Maryland (Kevin Plank’s alma mater), I could see them wanting to maintain ownership. If Nike really is their model and target, wouldn’t they want to emulate Doug Knight?  If that is the case, the likelihood of them selling would most likely diminish.

Nike could try to buy up a big chunk of Under Armour through non-Plank channels, but financially, this could be hard.  Merely on the news that Nike was considering the move, UA stock jumped up a couple of bucks.  If they started to actually buy UA stock at a rapid rate, I can only imagine what would happen to the overall acquisition price.  And this seems to be too risky a path for a behemoth like Nike to take.  Then again, if they see UA as a truly invaluable arm of their future plans, they might be more than willing to buy them, no matter the price.

So that’s really the question you have to ask yourself… how valuable is Under Armour, and their possible future market share, to Nike?

What do you guys think?  Is this going to happen or not?  If it does (or doesn’t), was it a smart move?  And by who?  SO MANY QUESTIONS STILL.  I know, I know…

About the author

Connor Wilson

Connor is the Publisher of He lives in Brooklyn with his better half, continues to play and coach both box and field lacrosse in NYC as much as possible, and covers the great game that is lacrosse full-time. He spends his spare time stringing sticks and watching Futurama.

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