EA Agrees to $55 Billion Leveraged Buyout

Описание: Ed Ludlow, host of Bloomberg Tech, discusses video game maker EA and their buyout agreement.

Electronic Arts Inc. agreed to sell to a group of private investors in a deal that values the company at about $55 billion, marking the largest leveraged buyout on record. 
The consortium, which includes Silver Lake Management, Saudi Arabia’s Public Investment Fund and Jared Kushner’s Affinity Partners, agreed to pay $210 per share in cash for the Redwood, California-based company, according to a statement Monday. That represents a 25% premium to where its shares traded before the talks leaked on Friday. 
Electronic Arts, the maker of EA Sports FC and The Sims, is selling amid sluggish growth for the $178 billion video game industry, after sales swelled during the pandemic lockdowns. The company, which has experienced numerous rounds of layoffs, has been seeking new areas of growth to inspire players who have gravitated toward free-to-play franchises that are continually updated rather than splash out on new titles that can cost $80.
The transaction will be funded with cash from the consortium partners, and Saudi Arabia’s PIF will roll over its existing 9.9% stake in the company, constituting an equity investment of about $36 billion. JPMorgan Chase & Co. will provide $20 billion of debt financing. The deal comes with a termination fee of $1 billion should it fall apart, according to a company filing.
Electronic Arts shares rose 4.8% Monday morning in New York. Gaming companies including Take-Two Interactive Software Inc. and Roblox Corp. also gained.
Founded in 1982, Electronic Arts is one of the world’s largest independent video-game publishers after a wave of industry consolidation of the past few years. Activision Blizzard, maker of the Call of Duty shooter games, was acquired by Microsoft Corp. two years ago. The pact displaces the $45 billion take-private of power company TXU in 2007 as the largest buyout on record. It’s also one of the largest M&A deal of 2025 and shows Wall Street’s appetite for game-changing mergers under the deal-friendly Trump Administration, despite recession fears and geopolitical concerns impacting the broader economy.
“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,” said Andrew Wilson, chief executive officer of Electronic Arts. “This moment is a powerful recognition of their remarkable work.”

Analysts are also expecting a boost from Battlefield 6, the latest entry in the company’s popular shooter game franchise scheduled to be released on Oct. 10. Early buzz for the title has been strong and helped lift shares 15% this year before news of the buyout emerged. 
Silver Lake, which has a long history of investing in the tech sector, is participating in the acquisition of the US business of TikTok, Bloomberg News previously reported. 
Goldman Sachs & Co. is serving as EA’s financial adviser and J.P. Morgan Securities LLC is serving as financial adviser to the consortium.
Legal advisers include Wachtell, Lipton, Rosen & Katz for EA and Kirkland & Ellis LLP is serving as legal counsel to the consortium.

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