Electronic Arts sold for whopping $55B, second-largest gaming acquisition ever
What's the story
Electronic Arts (EA), the maker of video games like Madden NFL, Battlefield, and The Sims, is being acquired for a whopping $55 billion. The deal is said to be the largest leveraged buyout in history, with a major portion of the acquisition financed through debt. The consortium of buyers includes Saudi Arabia's sovereign wealth fund Public Investment Fund (PIF), private equity firm Silver Lake, and Affinity Partners, which is run by US President Donald Trump's son-in-law, Jared Kushner.
Deal details
The deal will take EA private
The deal, if it proceeds as anticipated, will conclude EA's 36-year run as a publicly traded company, and it won't be traded on the stock exchange anymore. The purchase price puts a significant 25% premium on EA's market value, and the buyers will pay stockholders $210 per share. Andrew Wilson, who has held the position of EA's CEO since 2013, will continue in his role post-acquisition. On a related note, the company's headquarters will also remain in Redwood City, California.
Scenario
Second most valuable gaming purchase in history
EA deal will mark the second-largest gaming acquisition in history, after Microsoft's $69 billion purchase of Call of Duty publisher Activision Blizzard. The transaction faced heavy regulatory pushback worldwide, with UK authorities warning it could harm competition. Ultimately, approval was granted only after Microsoft agreed to transfer cloud distribution rights for Activision's console and PC titles to Assassin's Creed developer Ubisoft.
Market influence
EA's impact on the gaming industry and Saudi Arabia's investment
EA has been a major player in the gaming industry for over 40 years, responsible for some of the biggest game series in history. Its football titles have sold 325 million copies since their first release in 1993. The acquisition will mark a major milestone for Saudi Arabia, which has been expanding its presence in the gaming industry with investments such as Niantic's gaming division and hosting major esports tournaments.
Industry impact
Concerns over potential debt
The companies acquiring EA will contribute $36 billion, with the rest covered through loans, primarily from JPMorgan Chase. Industry experts are concerned about the deal resulting in $20 billion of debt that would need to be repaid. Another concern is whether this could trigger further job cuts at EA, particularly if private investors push for stronger cash flow to help service the debt. EA cut roughly 5% of its workforce in 2024, followed by several hundred layoffs earlier this year.
After effects
Deal expected to close in Q1 2027
Going private will give EA the freedom to reshape its operations without the investor pressure and scrutiny that often drive public companies toward short-term moves to satisfy quarterly targets. Despite a loyal fan base, EA's annual revenues have remained flat over the past three fiscal years, ranging between $7.4 billion and $7.6 billion. The transaction, approved by EA's Board of Directors, is slated to close in the first quarter of 2027, pending approval from EA shareholders.