- EA acquired for $55.000 billion, paying $210 per share
- Buying consortium: PIF (Saudi Arabia), Silver Lake and Affinity Partners
- Operation rated as the largest leveraged buyout and second largest in the video game sector
- Closing expected in the first fiscal quarter of 2027; Andrew Wilson will remain CEO
After days of speculation, Electronic Arts confirms its sale a a consortium comprising Saudi Arabia's Public Investment Fund (PIF), Silver Lake and Affinity PartnersThe transaction values the publisher at $55.000 million and contemplates a cash price of $210 per share, equivalent to an approximate 25% premium over the last closing price prior to the announcement.
The movement marks a before and after: it is an operation of large-scale in the video game industry, which puts EA in private hands and removes it from the public markets. Furthermore, the size of the deal places it as the largest leveraged buyout registered and the second largest acquisition in the sector following that of Activision Blizzard by Microsoft.
Details of the agreement and valuation
The consortium led by PIF, with the participation of Silver Lake y Affinity Partners, acquires 100% of EA's capital for $55.000 billion. The cash offer of $210 per share This represents a substantial premium for shareholders and ends the company's listing on the Nasdaq when the transaction closes.
EA, based in Redwood City, California, maintains a broad portfolio of franchises such as EA Sports FC, Madden NFL, NHL, The Sims, Battlefield, Apex Legends, Dragon Age o Need for Speed. Continuity in management is assured: Andrew Wilson will continue as CEO after closing.
According to the corporate statement, the board of directors of EA has approved the transaction and the company will cease trading its shares once the usual procedures are completed.The 25% premium recognizes the value of your assets and intellectual property in a context of consolidation of the sector.
Financial structure and leverage
The operation will be articulated as a leveraged buyout (LBO), with a cash price per share financed through a combination of equity and debt. Sources involved in the process indicate a capital contribution of nearly $36.000 billion and a debt tranche of up to 20.000 billion, committed entirely and exclusively to JPMorgan Chase, a substantial portion of which will be disbursed at closing.
In an LBO, buyers use financial leverage To acquire a company, relying on the acquired company's cash flows and assets as collateral. The goal is to boost operational efficiency and growth. to pay off the debt and maximize the return on invested capital.
Due to its size, this privatization of EA is considered the largest leveraged buyout of modern history. In the specific field of video games, it is only behind the agreement by Activision Blizzard signed by Microsoft, a recent benchmark in extra-large-scale operations.
The current interest rate environment and improved financing conditions have revived the appetite for megatransactions in technology and entertainment, facilitating large-volume capital structures and primarily cash-based operations at the equity level.
Calendar, corporate governance and regulation
The closure is planned for first quarter of fiscal year 2027 from EA, subject to customary approvals regulators and shareholdersUntil then, the company will continue to operate normally, and once the transaction is finalized will cease trading and will become a private entity.
The consortium has reiterated its support for the current leadership, so that Andrew Wilson will remain at the head of the company. This management continuity aims to ensure the business stability and the execution of the strategic plan in sports, games as a service and multiplayer experiences.
EA employs around 14.500 professionals worldwide, with a presence in Spain and a center in Madrid that brings together several hundred employees. In recent years, The sector has faced staff adjustments, and EA has not been immune to this context., with previously announced rationalization processes.
During the transition phase, The company will adapt its financial communications schedule to the demands of the process, prioritizing relevant facts and informative notes on results, in line with what these types of agreements usually establish.
What it means for the industry and for EA
With this operation, PIF strengthens its strategy diversification in video games and e-sports. The fund already had a participation close to 10% in EA and maintains investments in companies such as Nintendo, Niantic o ScopelyFor Silver Lake, with a track record in technology and creative assets, the move is consistent with its exposure to the gaming ecosystemAffinity Partners, for its part, adds capital and a network of relationships to the consortium.
For the industry, the privatization of EA may open the door to greater strategic flexibility outside of the quarterly market scrutiny, focusing on the development of franchises, production technologies and service models. Various analysts also point to the potential of synergies in eSports and sports licensing, areas in which EA and PIF already have a presence.
On the creative level, sagas like EA Sports FC, The Sims o Battlefield will remain at the heart of the portfolio. The commitment to maintaining Andrew Wilson supports the continuity of a strategy based on live experiences, global communities, and alliances with major leagues and federations.
With a cousin of the 25% for shareholders and a financial structure designed for the long term, the agreement places EA in a new corporate phase. The combination of patient capital, operational focus and established brands will determine the speed at which the company expands its reach and strengthens its position in an increasingly competitive market.
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