EA Poised to Go Private in Record-Breaking $55 Billion Deal Led by Saudi Arabian Investment Fund

Electronic Arts (EA), known for EA Sports FC, Apex Legends, and Madden NFL, is reportedly going private. A group led by Saudi Arabia’s Public Investment Fund (PIF), along with Silver Lake and Jared Kushner’s Affinity Partners, is set to acquire the company for approximately $55 billion.

If approved by regulators, the deal would be the largest all-cash buyout by private investors in the gaming industry and the largest private equity deal ever. This move would shift EA away from the pressures of Wall Street and towards more long-term capital investment, particularly within the gaming and esports sectors.

• PIF will retain its existing 9.9% stake. Additional funding comes from Silver Lake, Affinity Partners, and a debt package from JPMorgan Chase.
• EA will maintain its headquarters in Redwood City, California, with Andrew Wilson remaining as CEO.
• The acquisition is expected to close in the first quarter of EA’s 2027 fiscal year, subject to shareholder and regulatory approvals. Upon completion, EA stock will be delisted.

EA, a public company since 1989 and a major player in the video game industry, could gain increased flexibility by going private. This could allow for greater investment in live-service sports titles, cloud gaming experimentation, and expansion into emerging markets without the constant scrutiny of quarterly earnings.

This acquisition also reflects PIF’s ambition to diversify Saudi Arabia’s economy and establish a strong presence in interactive entertainment. The fund has recently invested heavily in companies like Capcom, Nexon, Nintendo, and Embracer Group. Acquiring a major Western publisher positions PIF as a significant force in the gaming industry’s ongoing consolidation, similar to Microsoft’s acquisition of Activision Blizzard and Embracer’s studio acquisition spree.

The profitability of this acquisition for PIF remains to be seen. Considering EA’s recent performance, doubts remain. While core titles like soccer and football games perform well, EA hasn’t had a major hit since Apex Legends in early 2019. Saudi Arabia’s investment track record is questionable, with significant spending on eSports with limited success and ongoing funding for a controversial mega-project called Neom.