England's £400m Nike deal contains performance clauses

Nike and the FA are close to agreeing a new England kit deal worth £400m over 12 years – but it comes with a catch.

The deal is worth marginally more than the previous agreement, which runs out after the 2018 World Cup, and works out at around £33m a year - not far behind the figures commanded by some of the biggest Premier League clubs.

However, Nike's "decision to not only extend but also enhance their association with the FA comes as something of a surprise given England's disastrous exit from last summer's European Championships and the recent, ongoing sexual abuse scandal, which could have serious consequences for the governing body", says The Guardian.

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Indeed, the company was considering pulling out of its current agreement "following frustration over poor replica shirt sales in 2014 and 2016", reports the Daily Mail.

England's current predicament meant the sportswear giant was "able to dictate terms to the FA, especially over the length of the deal".

The paper adds: "England's humiliating 2-1 defeat by Iceland at Euro 2016 ended FA ambitions of matching the £40m a year adidas are paying world champions Germany. And the mooted deal is well down on Nike's £60m-a-year contract with Chelsea which starts next season."

Added to that, there are also penalty and bonus clauses. Nike's payments "to the FA could reduce if the men's senior team fails to qualify for a major tournament or increase if they qualify and go onto reach the latter stages, specifically the semi-finals or beyond", says the Guardian.

Despite the fact the FA had little negotiating power and are now tied to Nike until 2030, "the deal will help to bring further financial stability to the FA, which in October agreed a six-season £820m overseas broadcast rights deal for the FA Cup", reports The Times.

"Martin Glenn, the FA chief executive, has made achieving such stability one of his key aims."

The FA are understood to have agreed big incentive payments for England doing well, plus contingency clauses if they fail to qualify for major tournaments.