A consortium led by Saudi Arabia’s Public Investment Fund has finalized a $55 billion takeover of video game giant EA, with financing support from Silver Lake and Jared Kushner’s Affinity Partners. The terms of the deal, including $20 billion borrowed from JPMorgan, make it the largest leveraged buyout on record.
CNBC reports that the deal, which closed late Tuesday, marks one of the largest leveraged buyouts in history and represents a significant expansion of Saudi Arabia’s presence in the gaming and sports industries. EA confirmed that its stock has ceased trading and will be delisted from the Nasdaq exchange.
Under the terms of the acquisition, EA shareholders will receive $210 in cash per share. The purchase was financed jointly by the Public Investment Fund, private equity firm Silver Lake, and Affinity Partners, the investment firm led by Jared Kushner, son-in-law of President Donald Trump.
Turqi Alnowaiser, the PIF’s head of international investments, said in a statement that entertainment and sports are key areas of strategic focus for the fund. The acquisition adds one of gaming’s most prominent publishers to Saudi Arabia’s growing portfolio of sports and entertainment assets.
The transaction involves approximately $20 billion in borrowing from JPMorgan, which served as advisor to the deal. This level of debt financing is believed to make it the largest leveraged buyout on record.
Industry analysts have raised concerns about the substantial debt burden the company will carry following the acquisition. Michael Futter, founder of F-Squared, told CNBC that the financial structure of the deal is likely to shape EA’s future direction significantly.
“The debt hanging over their head isn’t likely to create a shift in strategy,” Futter said. “Instead, it will likely see leadership entrench themselves in the titles they think have the largest revenue potential, even if those also carry the largest risk.”
Analysts expect the company to focus on its most established and profitable franchises rather than pursuing experimental projects. EA’s portfolio includes several major gaming properties, including The Sims, Battlefield, and various sports titles that generate consistent revenue.
The debt load raises questions about potential cost-cutting measures and strategic decisions ahead. Futter expressed skepticism about the company’s ability to manage its financial obligations without significant restructuring.
“I don’t know how EA is going to service this debt without significant layoffs, studio closures, and possibly IP sell-off,” he added.
The acquisition has also prompted discussion among analysts about the future of EA’s intellectual property portfolio. The company owns numerous gaming franchises built over decades, and questions remain about how these properties will be managed under the new ownership structure.
The Saudi Public Investment Fund has been actively pursuing investments in sports and entertainment sectors as part of the kingdom’s economic diversification strategy. Gaming represents a growing area of interest for the sovereign wealth fund, which has made several high-profile investments in the industry in recent years.
The completion of this transaction removes EA from public markets after years as one of the most prominent publicly traded gaming companies. The publisher has been a major force in the video game industry, particularly in sports gaming and simulation titles.
Read more at CNBC here.
Lucas Nolan is a reporter for Breitbart News covering issues of AI, free speech, and online censorship.