Electronic Arts (EA), the well-known video game developer, is on the cusp of going private. This highly lucrative buyout is fueled in large part by its franchises such as “Madden NFL,” “The Sims,” and “Battlefield.” The all-cash transaction values EA at $210 per share. That $53.50 figure would be a roughly 25% premium to Friday’s closing price before the first buyout rumors started appearing. Saudi Arabia’s Public Investment Fund, Silver Lake, and Jared Kushner’s Affinity Partners have led this remarkable acquisition. If completed it would be the biggest buyout in history.
The Wall Street Journal was the first to report the news of the buyout. They pointed to the increasing popularity of EA as the consumer trends in the gaming industry are rapidly changing. Now the consortium responsible for this winning bid is focused on closing on the acquisition by the end of Q1 FY27. They’re now waiting on regulatory approval.
EA has had a difficult time in the past years, resulting in a 5% cut to EA’s staff last year. These layoffs stemmed from a broader trend affecting video game companies that experienced initial growth during the COVID-19 pandemic but have since had to adjust to shifting consumer preferences. The company’s decision, then, arguably reflects a smart maneuver to these rapidly shifting market realities.
Andrew Wilson, Chief Executive of EA, reiterated his pride in the company’s accomplishments and in its loyal employees.
“Our creative and passionate teams at EA have delivered extraordinary experiences for hundreds of millions of fans, built some of the world’s most iconic IP, and created significant value for our business.” – Andrew Wilson, EA CEO
In his statement announcing the acquisition, Kushner professed his excitement over the acquisition and spoke about his personal connection to what EA has to offer.
“As someone who grew up playing their games — and now enjoys them with his kids — I couldn’t be more excited about what’s ahead.” – Jared Kushner
The impending acquisition is further evidence of a profound transition in the gaming industry as traditional power players scramble to reinforce their empires. EA’s legendary IPs are a huge weapon in their arsenal. As long as the influential new financial partners continue that support, the potential for gaming’s continued growth and innovative expansion into new areas seems enormous.