Electronic Arts to go private in record $55 billion leveraged buyout

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Videogame giant Electronic Arts will be taken private in a record-breaking $55 billion leveraged buyout by a consortium consisting of private equity firm Silver Lake, Saudi Arabia's Public Investment Fund and Jared Kushner's Affinity Partners, the company said Monday.

 

The deal for the maker of "Battlefield" underscores how deep-pocketed investors are betting on the enduring value of blockbuster game franchises as the industry recovers from a prolonged downturn. 

The deal would rank as one of the largest leveraged buyouts in history, surpassing 2007's buyout of TXU Energy and other major buyouts of that decade including Toys 'R' Us and Hertz. 

Under the deal, EA shareholders will receive $210 per share in cash, representing a premium of 25% as of the closing share price on September 25 before reports of a deal emerged. 

The take-private offer comes at a crucial time for EA, which is banking heavily on its core sports portfolio and action shooter intellectual property to weather a sluggish videogame industry as gamers get picky with spending. 

The offer comes as Electronic Arts gears up to launch the much-awaited "Battlefield 6" in an industry where gamers stick to proven and recognizable titles. 

The transaction, which is expected to close in the first quarter of fiscal year 2027, will be funded by a combination of cash from PIF, Silver Lake and Affinity Partners, as well as a roll-over of the PIF's existing stake in EA. 

EA must pay a $1 billion fee if it terminates the merger due to a board reversal, accepts a higher bid, or pursues another deal within a year of a shareholder rejection. 

The consortium owes the same amount if regulatory delays push completion past Sept. 28, 2026, or if it breaches the agreement. 

Industry acquisition

 

Deal backed by $36B equity, $20B debt

Consortium includes Silver Lake, PIF, Kushner’s Affinity

Shareholders receive $210 per share cash offer

Deal closing expected in early fiscal 2027

$1B termination fee if deal is canceled