Despite skinhead associations Herbalife to press ahead with Russian soccer sponsorship

BSR Russia/January 8, 2011

Los Angeles based direct marketing company, Herbalife, is continuing with plans to sponsor FC Spartak Moscow, Russia's most popular football club despite an outbreak of ethic violence as its fans rioted in Moscow, St Petersburg and Samara in protest at the shooting of a fan allegedly in a fight with North Caucasians.

Herbalife Ltd. sells nutritional supplements and skin care products through a multi-level marketing scheme and signed a deal reportedly worth $10 million over the company became the official nutrition sponsor of FC Spartak Moscow for the 2011-12 seasons.

FC Spartak Moscow is the most popular football club in Russia, having won 12 Soviet championships and nine of 18 Russian championships.

Under the agreement as Nutrition Sponsor, doctors and nutrition experts from Herbalife’s Nutrition Advisory Board will work with the club’s doctors to determine players’ nutritional needs and develop specific nutrition programs to support them.

The contract also gives Herbalife logo placement on the back of the first team jerseys on all games of the Russian Championship. Herbalife signage and branding includes Spartak’s home stadium, club’s bus, printed materials for the home games, and official website of the football club.

Rusian business daily Vedomosti reported, citing an unidentified club partner, that the contract would cost Herbalife about $10 million over 2 1/2 years.

In December more than 800 people were arrested in central Moscow in an attempt to prevent further ethnic clashes over the shooting of a Spartak fan, police said. The arrests came as groups of youths, many shouting nationalist slogans, gathered near a Moscow train station. The death of a Moscow Spartak fan, allegedly in a fight with North Caucasians, has prompted riots and attacks targeting ethnic minorities.

Dozens more people were reportedly detained in other Russian cities with police in St Petersburg holding 60 people and another 100 were arrested in Samara, according to Interfax news agency.

Herbalife has operated in Russia since the early 1990's initially through grey marketing by Israelis of Russian ethnic origin who translated and printed marketing materials in Cyrillic. Initially Herbalife denied they had a presence or operated in Russia. In the mid-90's as tyhe appeal and popularity of their products mushroomed Herbalife sent in a team of top executives protected by British bodyguards to legally structure operations with warehousing and customer support operations.

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