Electronic Arts Set for $50 Billion Private Buyout Deal

Menlo Park, California – Electronic Arts, the renowned video game publisher known for popular titles like “FC” and “Battlefield,” is in advanced negotiations to go private in a transaction valued around $50 billion. Sources familiar with the situation revealed that a coalition of investors, including private equity firm Silver Lake, Saudi Arabia‘s Public Investment Fund (PIF), and Jared Kushner‘s Affinity Partners, may finalize the deal as early as next week.

If completed, this deal would mark the largest leveraged buyout in history, a significant milestone for both the investors and the gaming industry. This take-private offer arrives at a pivotal moment for EA, as the company aims to strengthen its core sports franchises and action shooter portfolio amidst a challenging market where gamers are increasingly selective about spending.

Electronic Arts is particularly banking on the upcoming release of “Battlefield 6,” set for launch on October 10. The game is anticipated to perform strongly based on previous demand and has garnered excitement for its intense combat and high-quality visuals. In addition to “Battlefield 6,” EA also hopes to leverage its soccer game “FC 26” to boost sales.

Wyatt Swanson, an analyst at D.A. Davidson & Co, stated, “EA makes sense as an acquisition target due to its consistent cash flows and predictable revenue from annual game releases.” Following the announcement of the potential buyout, EA’s shares surged by approximately 15% on Friday.

Further context underscores a resurgence in mergers and acquisitions with greater confidence among executives, favorable capital conditions, and a need for consolidation in the video game sector. Goldman Sachs president John Waldron noted that U.S. megadeals could be on the rise as companies explore mergers to enhance scale and strategic positioning.

Both EA and Silver Lake have yet to respond to media inquiries regarding the ongoing discussions. PIF, the sovereign wealth fund of Saudi Arabia, is also making considerable investments in the video game industry, aiming to diversify its economy in line with its “Vision 2030” strategy. Its recent acquisition interests are seen as part of a broader strategy to solidify its influence in global entertainment.

Joost van Dreunen, a games professor at NYU Stern, remarked, “For Saudi Arabia’s PIF, this deal reinforces the idea of games as a vital cultural infrastructure, akin to sports or film.” The Kingdom’s investments extend to various sectors within gaming, including esports, where EA collaborates on several projects.