Electronic Arts To Be Acquired by Saudi-Led Consortium in Historic $55 Billion Gaming Deal

Electronic Arts, the renowned video game developer behind popular franchises like The Sims and Battlefield, has announced a historic $55 billion acquisition deal led by Saudi Arabia's Public Investment Fund.

The consortium includes US investment firms Silver Lake and Affinity Partners, the latter founded by Jared Kushner, former White House advisor and son-in-law of President Donald Trump.

EA Chairman and CEO Andrew Wilson expressed enthusiasm about the acquisition, stating it represents "a powerful recognition of their remarkable work" regarding the company's employees. He added that the deal would "unlock new opportunities on a global stage."

This transaction is poised to become the largest all-cash private equity buyout in history. Electronic Arts, which reported $7.5 billion in revenue during its most recent fiscal year, is known globally for its iconic franchises.

The company's FIFA soccer game series ran annually from 1993 to 2023 until EA lost the license following financial disagreements with the FIFA organization. The game continues under the new name EA Sports FC and has maintained its strong player base, becoming Western Europe's best-selling game in 2023.

EA also owns The Sims franchise, which allows players to create avatars and develop characters in virtual worlds. Twenty-five years after its initial launch, The Sims continues to attract new players, with EA reporting that 85 million people were playing The Sims 4 as of May 2024.

The California-based company is additionally preparing for the release of Battlefield 6, the 13th installment in its popular first-person shooter series. After experiencing significant revenue growth following the Covid-19 pandemic, EA has recently faced a slowdown, reflecting broader industry trends.

This major acquisition follows Microsoft's $75 billion purchase of Activision Blizzard two years ago, which also resulted in that company leaving the stock market. On Wall Street, shares of remaining listed gaming companies rose following the announcement, with Roblox increasing by 4.72 percent and Take-Two Interactive gaining 1.53 percent.

The acquisition is expected to close in early fiscal 2027, subject to approval from EA shareholders and regulatory authorities. Saudi Arabia's PIF, which already holds a 9.9 percent stake in EA, will roll over its existing investment as part of the transaction.

This announcement follows President Trump's May tour of the Gulf region, which included promises of significant investments. Trump signed a "strategic economic partnership" agreement with Saudi Crown Prince Mohammed bin Salman, which according to the White House will bring $600 billion in Saudi investments to the United States.

Video games are central to the crown prince's ambitious "Vision 2030" reform plan. With 70 percent of Saudi Arabia's population under 35 years old, and the 40-year-old crown prince himself reportedly being a fan of Call of Duty, gaming and esports have become strategic investment areas for the oil-rich nation.

The deal will be financed through approximately $36 billion in equity from consortium members and $20 billion in debt committed by JPMorgan Chase. Upon completion, EA will be delisted from the Nasdaq stock exchange while maintaining its headquarters in Redwood City, California, with Andrew Wilson continuing as CEO.

This agreement represents PIF's latest major investment in the gaming sector as Saudi Arabia continues efforts to diversify its economy beyond oil revenues.