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DHL May End Sponsorship of Baseball’s Atlanta Braves (Update1)

By Danielle Sessa

Nov. 18 (Bloomberg) -- DHL may end its sponsorship of the Atlanta Braves following the Deutsche Post AG unit’s withdrawal from the U.S. express-delivery market.

“They have indicated a desire to terminate,” Derek Schiller, executive vice president for sales and marketing for the Braves, said in an e-mail. “We are currently evaluating their sponsorship.”

Major League Baseball will hold talks with DHL about the future of its partnership, and Cincinnati Reds executives are scheduled to meet with the company tomorrow.

“As we do with all of our partners, we stay abreast of their business situations and how it relates to our partnerships,” MLB spokesman Matt Bourne said. “We’re discussing DHL’s situation with them.”

Company and baseball officials declined to disclose terms of the agreements.

DHL has said it will continue its MLB partnerships even after it fired 14,900 workers and closed three-quarters of its outlets because it failed to compete with United Parcel Service Inc. and FedEx Corp. in the U.S. It will only focus on international deliveries in the U.S.

“We have made no changes with regard to our baseball sponsorships,” company spokesman Jonathan Baker said in an e- mail yesterday. “Given the change in strategic direction to focus on our international services in the U.S. market, we will be examining these in conversations with our partners.”

Baker didn’t immediately respond to an e-mail about the deal with the Braves.

DHL in 2005 signed a three-year agreement with Major League Baseball to sponsor the sport’s monthly and annual “DHL Delivery Man” awards for relief pitchers. The company extended its partnership in March 2007 through the 2010 season and sponsors at least six clubs. DHL also sponsors the All-Star Fan Fest that includes exhibits and player autograph sessions.

DHL Promotions

The company promoted its ties to baseball with commercials starring Johnny Damon, then with the Boston Red Sox, and Kenny Lofton, who’s played for nine clubs since 2002. Trucks making deliveries carried the MLB logo.

The Reds, Los Angeles Dodgers and San Francisco Giants have agreements with DHL for the next two seasons. DHL has an option to extend its partnership with the Cleveland Indians for 2009.

“I don’t have an indication one way or the other about the option,” said Vic Gregovits, Cleveland’s senior vice president for sales and marketing.

DHL will be visiting the Reds tomorrow to discuss the partnership, Bill Reinberger, the team’s vice president of corporate sales, said in an interview.

Giants and Red Sox

The Giants are “trying to figure out what’s going to happen,” with their DHL sponsorship, team spokeswoman Staci Slaughter said. The Boston Red Sox’s agreement with DHL is “to be determined,” said the club’s Chief Operating Officer Mike Dee.

The New York Mets had a partnership deal with DHL that expired at the end of the season. Schiller, of the Braves, didn’t say how many years were left on the team’s DHL contract.

“We are in regular contact with our partners, but have made no decisions to change our current sponsorship arrangements,” said DHL’s Baker.

It makes sense for DHL and baseball to recast the partnership to make it work, said David Carter, executive director of the Sports Business Institute at the University of Southern California.

“They both really have an incentive to play nice right now,” Carter said in an interview. “The last thing either one wants is to have a high-profile problem in the marketplace.”

DHL is ceasing domestic truck operations and will hand over U.S. air shipments to UPS. The remaining 103 outlets will focus on international deliveries.

UPS is the leading U.S. express-delivery service with 51 percent of the market, followed by FedEx at 31 percent and the United States Postal Service with 13 percent, according to SJ Consulting Group. DHL ranked fourth with 5 percent.

To contact the reporter on this story: Danielle Sessa in New York at dsessa@bloomberg.net

Last Updated: November 18, 2008 17:27 EST

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