Saudi Arabia's Public Investment Fund Leads $55B Electronic Arts Buyout

Electronic Arts (EA), a major video game publisher known for franchises like Madden NFL, FIFA, and The Sims, is being taken private in a historic $55 billion leveraged buyout led by Saudi Arabia's Public Investment Fund (PIF), along with Affinity Partners, managed by Jared Kushner, and Silver Lake Partners. This deal, the largest buyout of its kind, values EA shares at $210 each, representing a significant premium over recent trading prices and extending Saudi Arabia's existing 9.9% stake in the company. The acquisition is part of Saudi Arabia's broader strategy to diversify its economy and expand its influence in the global gaming and esports industry, which includes previous investments like the $4.9 billion purchase of Scopely and hosting major esports events. EA's transition to a private company will allow it to restructure away from public market pressures, though it may face operational changes, including potential cost-cutting measures, following a recent round of layoffs. The consortium's financial commitment includes $36 billion in equity and $20 billion in debt financing, with PIF likely the largest contributor. This transaction highlights the intersection of geopolitics and the growing economic significance of the video game sector.