MLB deepens ties with Sportradar in data deal expansion

NEW YORK - Major League Baseball (MLB) has strengthened its relationship with Sportradar Group AG (NASDAQ: SRAD), a global sports technology company showing impressive growth with revenue increasing by 26.55% over the last twelve months, by extending and expanding their partnership. The new agreement, which will take effect in the 2025 season, includes an equity stake for MLB in Sportradar, enhancing the collaboration between the two entities. According to InvestingPro, the company maintains a strong financial position with more cash than debt on its balance sheet.

Under the updated terms, Sportradar will have exclusive rights to distribute MLB’s official data and audiovisual content, including ultra-low latency data and Statcast Data, to its extensive network of over 800 sportsbook clients and 900 media companies worldwide. This deal aims to capitalize on the growing global popularity of baseball and the increasing legalization of sports betting. The company’s strong market position is reflected in its financial health, earning a "GREAT" overall score from InvestingPro, which offers comprehensive analysis through its Pro Research Report, available for over 1,400 US stocks.

To maintain the integrity of the sport, Sportradar will continue to provide its Universal Fraud Detection System (UFDS) to monitor betting activities and offer investigative and educational support to MLB. Additionally, the two organizations plan to work together on developing AI-driven products that utilize player tracking data to create personalized fan experiences.

In exchange for these rights and benefits, Sportradar will pay annual license fees, and MLB will receive up to 1,855,724 Class A ordinary shares during the term of the agreement, subject to certain conditions.

Kenny Gersh, MLB Executive Vice President, Media & Business Development, highlighted Sportradar’s role in navigating the evolving sports betting landscape and developing products using MLB’s data. Carsten Koerl, CEO of Sportradar, expressed enthusiasm for the continued partnership and the opportunity to innovate and engage fans globally.

The collaboration, which is immediately accretive to Sportradar’s business, is expected to drive shareholder value and expand margins, as well as generate strong cash flow.

Sportradar has been an official partner of MLB since 2014 and has recently been selected to provide the league with its Synergy Sports Coaching & Scouting solution for advanced sports performance analysis.

This agreement is based on a press release statement and reflects the ongoing efforts by MLB to increase its presence and fan engagement on a global scale, leveraging Sportradar’s technology and content distribution capabilities.

In other recent news, Sportradar Group AG has been experiencing significant developments. The company reported a strong third quarter, with a 27% year-over-year increase in revenues, reaching €255 million, and a 30% rise in adjusted EBITDA to €66 million. Subsequently, the company raised its full-year revenue and adjusted EBITDA guidance, reflecting strong operational momentum.

Sportradar also entered into a multiyear agreement with Major League Baseball (MLB) to enhance the league’s scouting of amateur baseball talent, an expansion of their existing relationship. This partnership is expected to transform player potential evaluation using Sportradar’s advanced technological platform.

In terms of analyst ratings, JMP Securities reiterated their Market Outperform rating for Sportradar, maintaining a price target of $19.00. The firm highlighted the ongoing negotiations with MLB and the company’s resilience to recent tax rate changes for sports betting in Illinois. Additionally, Citi increased its price target for Sportradar from $18.00 to $20.00, maintaining a Buy rating, based on the company’s expected ability to generate significant free cash flow.

These recent developments underscore Sportradar’s strategic positioning in the sports data industry, its solid financial performance, and its ability to navigate regulatory changes. The company’s ongoing negotiations with MLB and its resilience to regulatory changes are key factors in its future growth trajectory.

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