Fast Food Chain McDonald's extended Sponsorship Agreement with International Olympic Committee

Fast Food Chain McDonald's extended Sponsorship Agreement with International Olympic Committee

US fast food chain McDonald's in January 2012 extended its global sponsorship agreement with the International Olympic Committee until 2020. McDonald's signed up to sponsor the Olympics for a further eight years till 2020. It essentially means athletes and fans will be offered its burgers and fries in the official restaurants at Games venues until 2020.

The value of the new deal is likely to be about $200 million based on what sponsors have paid in the past. McDonald's is the seventh major company to agree to support the Games until 2020.

McDonald's has been the long-time and valued Olympic Partner for more than 35 years. McDonald's, an Olympic sponsor since 1976, began its involvement at the 1968 Winter Games when it flew hamburgers to U.S. athletes in the French Alpine resort of Grenoble after they reported being homesick for American food.

It plans to continue its ongoing commitment not only to help fund the Olympic Games but also to support the Olympic Movement around the world and ultimately the athletes themselves.

The agreement was signed at the world youth Olympic Games in the Austrian city of Innsbruck. The move will help boost McDonald's brand in fast-growing economies, with the 2014 Winter Games to be held in the Russian city of Sochi and the 2016 summer Games in Rio de Janeiro, Brazil. The 2018 Winter Games will be held in Pyeongchang, South Korea.

The deal is set to expire in 2020 because IOC plans to review its sponsorship programme beyond that date to take account of developments in technology. The IOC received revenues of $957 million from its 11 leading sponsors for the Winter Games in 2010 in Vancouver and the Olympics in London in 2011.

Atos Origin, Panasonic and Samsung extended their partnerships until Rio while Coca-Cola, Visa, Omega, Dow, GE and Procter & Gamble signed deals until the 2020 Games. However Taiwan-based computer company Acer, the only leading sponsor that has not so far renewed its sponsorship.

Under a long-standing contract, the USOC receives a 20 percent share of global sponsorship revenue and a 12.75 percent share of U.S. broadcast rights deals. Any new formula would go into effect after 2020.