Sportradar AG filed plans yesterday with the US Securities and Exchange Commission (SEC) for an initial public offering (IPO). Sportradar AG’s Form F-1 filling was introduced a little over two months after Horizon Acquisition Corp, a Swiss firm and a SPAC (special purpose acquisition company), decided not to go further with talks that would allow Sportradar to go public.
Rumors Stated That Sportradar Could Seek a Valuation of Up to $12 Billion
The Swiss-based company released a statement on the matter where it says that the number of shares and the price for those shares haven’t been determined, and Sportradar plans to place its common stock under the SRAD ticket symbol on the Nasdaq Global Select Market. The offerings’ lead book-running managers are Citigroup, UBS Investment Bank, J.P. Morgan and Morgan Stanley, while the additional joint book-running managers are Deutsche Bank Securities, Jefferies and Canaccord Genuity, and BofA Securities.
The rumors on the Sportradar IPO started circling approximately a year ago and the initial speculations stated that Sportradar’s desired valuation was between $10 and $12 billion. For a blank-check transaction, that is quite a big number, but, in March, it was reported that Horizon Acquisition II and Sportradar almost agreed on a deal worth $10 billion. In 2018, Sportradar was valued in private markets at $2.4 billion.
There is still no news about what valuation Sportradar will include in its IPO. The nearest rival of this company, Genius Sports, had a $1.5 billion value when it merged with the dMY Technology Group, Inc. II SPAC. The market capitalization of Genius Sports is $3.19 billion and, recently, this company signed a new supplier agreement with DraftKings, one of the top-ranked sportsbooks in the US.
Sportradar Has Major Brands as Clients
Some of the clients that Sportradar has include giants such as the MLB, NASCAR, FIFA and the NHL, as well as the NBA.
If there is one thing that the Sportradar IPO will do, is that it will test the confidence of investors in newly public companies that are connected to sports betting. Even though statistics show that the sports betting market in the US is growing, numerous IPOs are floundering, but many of them are de-SPACed companies.
Furthermore, there are some market participants that are not very confident about long-term relationships with companies like Genius or Sportradar. A recent Genius report showed that Spruce Point Capital Management, a short seller, stated that the company acts as a middle man and it doesn’t do much work in differentiating itself from the competitors on the market. That is why, when it comes to pricing, it is all at the mercy of the leagues.
Confident investors in this sector state that as regulated sports betting reaches new heights, operators will have to pay for the Genius and Sportradar premium data and that would bring massive growth in the in-game betting market.
The one thing that is sure is that well-known companies that invested in Sportradar will make a profit from the IPO. Those companies include TCV, a private equity firm, the Canada Pension Plan Investment Board and three NBA owners – Ted Leonsis (Washington Lizards), Mark Cuban (Dallas Mavericks) and Michael Jordan (Charlotte Hornets).