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NFL Swaps Genius Sports Warrants for Cash in Deal Extension

The NFL and Genius Sports altered the payment terms of their agreement when the league and the sports data and analytics company extended their exclusive data rights deal through the 2027-28 season last month. Instead of the NFL collecting 4 million warrants in Genius Sports for two of the three years of the extension, the league will instead be paid in cash, according to CEO Mark Locke, speaking on a call with analysts Monday.

“We believe that this is in the interest of our shareholders as it is less dilutive than it would have been otherwise, and we have agreed [on] a predetermined cash amount, which will be included in our rights fees and leaves us confident in our ability to continue growing profitability through the life of the deal,” Locke said in prepared remarks delivered on the call, according to a transcript from S&P Global Market Intelligence.

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The dollar amount of the NFL deal wasn’t disclosed. A request for comment from a Genius Sports spokesperson didn’t receive a response.

Last month, the NFL added three years to its current data rights deal with Genius, giving exclusive data and live video rights through the 2027-28 season. According to Locke, paying cash instead of warrants for the data will allow Genius to account for the cost of the deal across multiple years and fold the expense in with the company’s normal data rights fees.

The NFL received 18.5 million warrants for its initial deal with Genius signed in 2021, with an option to receive 2 million additional warrants for each of two more annual extensions. Based on the price of Genius just prior to Sportico first reporting news of that deal, those 22.5 million warrants represented share value of worth $331 million—and as much as $566 million when Genius shares were at their peak in June 2021.

Genius stock has fallen about 50% from when the deal was reached, meaning the NFL’s current 8% stake in the company is worth $135 million today. The NFL’s 18.5 million warrants are vested and exercisable at a penny apiece, meaning the league effectively is one of the largest shareholders in the U.K.-based business.

“We now know the exact amount of fees payable to … the NFL through 2028, and we feel confident in our ability to continue growing our profitability through that time frame and beyond,” Locke said.

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