Nike is strategically shifting how it manufactures NCAA fan apparel in a deal with fanatics

Sports merchandise platform Fanatics is entering into a long-term partnership with Nike to manufacture college sports fan apparel.

The partnership will include collaborations with the department of Fanatics College, which already partners with most of the colleges and universities sponsored by Nike. Manufacturing is set to begin in the summer of 2024, according to sources familiar with the matter.

Fanatics provided CNBC with a statement from Fanatics Commerce CEO Doug Mack that said he was “excited about maximizing the value of Nike’s college partnerships,” but declined further comment.

Nike said in a statement that it is making a strategic shift in how it serves NCAA university partners, and is expanding its licensing relationships with Fanatics and Branded Custom Sportswear, another university partner, to include Nike NCAA retail fan and side products.

Nike has some of the biggest contracts with top college sports programs to equip their school teams, worth millions of dollars. According to Sports Business Journal, Nike and the Jordan brand outfitted 48 teams in the latest NCAA basketball tournament, the highest percentage ever. It also fits more than half of the Division I football programs.

Nike will continue to manufacture apparel and merchandise for its college team partners, including field apparel, according to sources.

Fanatics will manufacture fan wear, replica T-shirts, side wear, headwear, and women’s fan gear, among other things. The New Fanatics deal will include a select group of Nike partners from colleges and universities, with Ohio, Georgia, Clemson, Oregon, Oklahoma and Pennsylvania among the potential participants, according to the sources, and investing in the growth of the women’s apparel business among the partnership’s goals.

Fanatics already have exclusive licensing deals with the NFL, NHL, NBA, and MLB, as well as many colleges and universities. Many of those deals, including the NFL, NBA, and MLB, also overlap with Nike’s apparel deals.

Fanatics is a major hub for sporting goods, as well as home and office consumer products and automobiles with a sporty character. The company is expanding into online sports betting as well. The three-times CNBC Disruptor 50 is worth $27 billion.

It has completed several acquisitions in recent years as a closely held company. In 2020, it acquired sports-goods maker WinCraft, and earlier this year it bought trading card company Topps for $500 million. Last month, CNBC reported that fanatics are in talks to buy sports betting company Tipico, although a deal has yet to be reached.

Topps will release a batch of trading cards featuring college athletes this coming fall season, in a deal that parent company Fanatics said will cut some players’ earnings and pair them with school logos on the cards for the first time. The program will include more than 150 schools with current and former athletes. The company also deals with more than 200 individual sports students in those schools to use their names and shapes. Fanatics said the plan is to continue adding schools and athletes.

The majority of Power Five convention schools will participate in the new Fanatics trading card deal, including Alabama, Georgia, Kansas, Kentucky, Oregon and Texas A&M.

Recently expanded name, image, and similarity rules allowed college athletes to sign sponsorship deals, opening up additional opportunities around apparel and merchandise. The Fanatics recently struck a deal that would allow fans to purchase personalized college football jerseys with the names and numbers of active players to be compensated for.