A Tale of Two Bankruptcies
On the same day that properties like the Vancouver Olympic Organizing Committee and the NHL's Vancouver Canucks announced that they believe newly bankrupt General Motors will honor its multi-million dollar sponsorship commitments, Bearing Point and the PGA Tour reached a deal to scratch the bankrupt company's name off the benefactor’s pavilion and the dining chalet at upcoming golf tournaments. Six months after signing the multi-million dollar PGA sponsorship deal, the two parties split ways in exchange for a $4 million unsecured claim in the Bearing Point's bankruptcy case.
WSJ: "BearingPoint’s bankruptcy case, which has led to the company being sold off in parts to former competitors, eliminated the firm’s need to promote itself at high-profile golf tournaments."
As for GM, according to recent reports they will honor their high profile partnerships including a 20-year, $18.5-million naming rights deal with the Vancouver Canucks and a $14 million cash and $53 million in-kind deal with the VANOC.
However, while both properties say that GM will honor their agreement, over the past year GM has been slowly been unraveling sponsorships as part of its plan to trim its marketing budget by approximately $800 million. This includes everything from NASCAR ($120-$140 million spend in '08) to MLB (local market deals) to Tiger Woods ($7 million per year). Stay tuned.