Nike, the American sportswear giant, is believed to have sparked a £220 million bid battle for Umbro, the official England football kit maker founded 83 years ago.

Umbro today revealed it had received a takeover approach in a statement that sent its shares up by nearly 28 per cent.

Despite fervent speculation of a move by Mike Ashley, the Sports Direct billionaire who has been building a stake in Umbro, sources close to the deal ruled out the tycoon and said Nike was the bidder.

Nike refused to comment while Umbro refused to add to a statemet announcing the approach this afternoon.

In it the group said: “In response to recent speculation, the board of Umbro confirms that it has received an approach which may or may not lead to an offer being made for the entire issued share capital of Umbro.

“A further announcement will be made in due course.”

The shares soared 33p to close at 153p, valuing the business at £220 million.

News of the approach came less than 24 hours after England’s chances of qualifying for the Euro 2008 football championships were dealt a serious blow following defeat in Russia.

Analysts believe Umbro’s profits could fall by more than 40 per cent next year if England ultimately fail to qualify for the tournament.

Umbro last month issued a stark profit warning following poor sales of England replica tops in part fuelled by the dismal form shown by Steve McClaren’s team.

John Stevenson, analyst at Shore Capital, said the timing of today’s approach was “surprising” given that a wave of profit downgrades could be coming out over the next month.

Nike, Russia’s kit maker, may have been prompted by Mr Ashley’s stakebuilding.

He yesterday took his shareholding in Umbro to 15 per cent and had been widely tipped to make an offer himself.

Mr Stevenson said that any bidder would have to renegotiate Umbro’s current deal with the England team.

However, he added: “On the positive front Umbro offers strong medium and long term earnings growth potential from its growing international presence.

"Strategically an approach from Sports Direct or a sports business without football interests would make more immediate sense to us, although Umbro is in the early stages of its international growth ambitions, which could be advanced by more established hands."

A successful takeover by Nike would give the American firm a huge presence in the Premiership, where it already supplies the kit to Arsenal and Manchester United among others.

Umbro supplies six Premiership teams including Birmingham and West Ham.

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