Still smarting from the loss of a lucrative sports betting deal with the NFL, Sportradar is backing out of negotiations with a prominent SPAC on a transaction that would have taken the global betting data provider public, according to media reports.
Instead, Sportradar will attempt to pursue a traditional IPO in its path to go public, Sportico reported on Tuesday morning. In March, Sportradar reportedly agreed to a deal in principle with Horizon Acquisition Corp. II (HZON), a SPAC led by Los Angeles Dodgers co-owner Todd Boehly, that valued the company around $10 billion. At the time, Sportradar signed a letter of intent that gave the parties an exclusive negotiating window to complete the deal.
A Sportradar spokesman did not immediately respond to a request from Sports Handle for comment.
Although the sides agreed to extend the negotiating period last month in attempts to secure private funding from institutional investors, a deal with HZON was never formalized, a source told Sports Handle. Without the NFL contract, a revised deal to take Sportradar public may have come at a considerably lower valuation, the source indicated at the time.
Landmark Genius Sports deal with the NFL
In the midst of negotiations with HZON, Sportradar suffered a bitter defeat to archrival Genius Sports for exclusive rights to the distribution of the NFL’s official sports betting data platform. In April, U.K.-based Genius Sports agreed to a multi-year deal with the NFL that gave the company exclusivity to the global distribution of the NFL’s sports betting, play-by-play, and “Next Gen” stats. The four-year deal is worth as much as $1 billion and grants the NFL a roughly 5% equity stake in Genius, CNBC reported.
In response, a Sportradar executive penned a letter to sportsbook clients outlining the company’s strategy moving forward. Sportradar previously gained exclusive rights to distribute NFL official league data to U.S. sportsbooks in a deal struck in August 2019. But the company’s sports betting-related deals with the NFL expired at the end of the 2020-21 league year.
“As you would expect, this was a very competitive process, but the economics became irrational and would have required at least a five-fold increase in the fees charged to our customers for the same content and/or a level of loss-making on our part which simply did not make sense,” Sportradar Chief Commercial Officer Eduard Blonk wrote in the letter.
Sportradar subsequently inked marketing deals with the NFL’s Baltimore Ravens and New York Jets in partnerships that do not include access to the league’s official betting data feed. The Ravens’ deal was reached shortly after Maryland Gov. Larry Hogan signed a sports betting bill into law on May 18.
Sportradar, a Switzerland-headquartered company, is still an official provider of sports betting data for the NHL, NBA, MLB, NASCAR, FIFA, and UEFA. In August 2020, Sportradar signed a deal with the NHL that made the company the exclusive gatekeeper of sports betting data for the league.
As of 12:00 p.m. ET, HZON traded at $9.81 a share, down 0.13 or 1.36%. Horizon shares reached a high of $11.89 on March 5 on reports of a potential deal with Sportradar.