Sportradar snaps up XLMedia’s North American assets for $30m

XLMedia has agreed to sell its North America-facing business to Sportradar for up to $30m (£23m) in cash before winding up the group in late 2025.

Sportradar will pay an initial $20m upon completion of the transaction with a further $10m payable in April 2025, based on performance markers for the acquired assets.

The deal values XLMedia’s North American assets at 8.8p a share, with the segment reporting revenue and adjusted EBITDA of $27.5m and $5.5m respectively in the 12 months to 31 December 2023.

XLMedia is currently live in 21 US states for its sports betting operations and four for online casino.

The business operates the CBWG, Sports Betting Dime and Saturday Football Inc brands in the US, with revenue coming from these entities as well as media partnerships.

XLMedia pushed into the US by acquiring CBWG in December 2020, before snapping up Sports Betting Dime in March 2021 and Saturday Football Inc that September.

However, the wider group has struggled in recent years. In March this year, it sold off its European and Canadian assets to Gambling.comGroup in a deal worth up to $42.5m.

The board said that the sale came after the growth of its US revenue stream did “not match” the group’s original plans.

XLMedia said: “Due to the obligation to fund the historical US acquisitions out of cash generated from trading, some of which occurred in a high-value market, the group has been limited in its ability to participate in further acquisitions and has instead focused on growing the existing owned and operated footprint and expanding the media partnership business roster of partners.

“When assessing the value of the North America business, the board has primarily taken into account the future revenue, profitability and free cash flow of the North America Business assets as well as the value of the technology, relationships and brands to an acquiror.”

Under the remit of the deal, about 35 XLMedia employees will transfer to Sportradar while XLMedia will be obliged to provide “limited transition support services” for three months.

The initial $20m payment is slated for 12 November. XLMedia noted it expects to receive $18m in cash from the initial payment, with yet-to-be-determined proceeds to be returned to shareholders in Q4 2024.

From 12 November, XLMedia will also be classified as a cash shell, with it having sold its primary trading activities and retaining roughly 5% of remaining revenue sources.

Then, in April 2025, XLMedia is anticipating receiving further payments from both Sportradar and Gambling.com Group, which will then initiate the winding up of the company.

Scheduled for 12 May 2025, XLMedia will suspend its shares trading on London’s AIM, as per cash shell rules, with 12 November 2025 marked as the final date on which the company can be removed from the exchange.

Following this cancellation, winding-up proceedings for the business will commence.

The XLMedia board said the transaction was in the company’s best interest and its shareholders and have recommended a vote in favour at its general meeting on 7 November this year.

XLMedia also reported that Sportradar received “irrevocable voting undertakings” to back the transactions from shareholders representing around 31.18% of the company’s ordinary share capital.

The transaction also marks a major step into the world of affiliation for Sportradar, which has its roots as a sports betting and marketing technology supplier.

Marcus Rich, XLMedia chair, said: “In an ongoing commitment to maximise shareholder value, following the Europe disposal, the board is pleased to have reached an agreement to sell the North America Business to Sportradar pending shareholder approval. 

“We anticipate an initial distribution from the net proceeds to shareholders before year end.”