Sportradar’s share price tumbled almost 23% on Wednesday, 22 April, after a pair of short sellers published reports alleging the supplier was supporting black market operators.
Following the two reports from Muddy Waters Research and Callisto Research, the New York-listed firm’s stock closed at $13.04 (£9.66), its lowest level since November 2024 and way down on the $30 high the stock hit eight months ago.
The selloff meant Sportradar’s market cap at the close on the Nasdaq was $3.9bn.
Muddy Waters describes itself as a “pioneer in on-the-ground, freely published investment research” and this year has issued short reports on US financial tech firm SoFi Technologies and mobile tech company AppLovin.
Muddy Waters’ 123-page document on Sportradar alleged its team was able to pose as startup sportsbook founders at ICE in Barcelona in January under the pretence of plans to launch operations in Southeast Asia.
The report claimed Sportradar reps were supportive of their aims, including launching in markets where gambling remains illegal, such as China, Vietnam, Thailand and Indonesia.
Muddy Waters also alleged it had found Sportradar Client ID codes on around 40 unlicensed operators’ sites, with those codes corroborated by ex-Sportradar sales staff.
The report claimed black market operators make up a significant portion of the company’s revenue, including bookmakers with ties to Russia.
At the high end of the estimate, this is as much as 40% of revenue, however, on a conservative estimate it is 10%, Muddy Waters noted.
Meanwhile a second report from Callisto alleged an ex-Sportradar employee estimated unlicensed income could make up between 30% and 40% of group revenue.
The 43-page report claimed to have found 270 individual platforms using Sportradar products while “working illegally in regulated or prohibited markets”. Throughout, the report made similar allegations to the Muddy Waters paper.
The Callisto paper read: “Sportradar’s current valuation reflects a premium compliance profile and the perceived stability of its regulated market positioning. We believe the findings outlined in this report materially challenge that assumption.
When contacted by EGR, Sportradar firmly denied the allegations.
A company spokesperson said: “A short report issued today contains factual inaccuracies about the company, and we unequivocally challenge these assertions.
“The report demonstrates a fundamental misunderstanding of our business and the industry and was authored by a short seller trying to erode shareholder value and profit from stock disruption.
“Sportradar works exclusively with licensed operators, follows strict global compliance and due diligence standards, and we stand by our independently audited financial statements, risk disclosures and information provided to investors and regulators.
“We conduct our business with the highest ethical standards consistent with company policies, laws and regulations.”
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Sports data supplier accused by Muddy Waters Research and Callisto Research of servicing black market operators, though bosses say they “unequivocally challenge these assertions”
The post Sportradar shares nosedive on the back of short seller reports first appeared on EGR Intel.