The Spanish giants may not be having the best of starts to the season but their marketable value remains immense with German sportswear manufacturer willing to pay more than €1billion for the honour of supplying the club for 10 years.
The new deal has the potential to double the existing agreement. It dwarves the agreement Nike have with the NBA in the States which sees 21 teams sponsored for €1billion.
Adidas recently shelled out millions to make Arsenal's kit from next season and they even more to win the Manchester United contract. The next mega contract to be unveiled could be Liverpool as the current deal with New Balance is due to expire next year.
Real Madrid's fierce rivals Barcelona has a similarly lucrative deal with Nike which is believed to be worth around €1billion over 10 years.
This current Real Madrid/adidas kit deal stretches back to 1998 and recent Champions League successes have reinforced their market value in recent years. American sportswear firm Under Armour, who currently supply Southampton and have also kitted out Tottenham Hotspur in the past, were believed to be adidas' main rivals for the Real contract as they looked to break into the European market.
It's understood that Puma will replace Nike as Manchester City's kit supplier next season in another multi-million deal.
• Real Madrid and Adidas have a stratospheric contract ready
• It would be the highest sponsorship deal with a club
• It doubles the current annual contract of Manchester United (€85m) and Barcelona (€83m)