Electronic Arts, the studio behind Battlefield and Madden NFL, has just pressed start on what could be the largest leveraged buyout ever recorded. In a blockbuster move, EA agreed to sell itself for $55 billion to a consortium led by Saudi Arabia’s Public Investment Fund (PIF), Jared Kushner’s Affinity Partners, and private equity giant Silver Lake.
The group will finance the deal with $36 billion in cash, equity already held by PIF, and $20 billion in debt backed by JPMorgan. If completed, the takeover would surpass the infamous $45 billion TXU Energy deal in 2007, making it the biggest LBO in history.
For Saudi Arabia, the deal represents more than just a financial bet. It’s a strategic move in the kingdom’s Vision 2030 plan to diversify away from oil and build a global presence in sports and gaming. “The financial backing and resources of the investor consortium should enable EA to increase its focus on long-term growth opportunities that may have been viewed as too risky or expensive as a public company,” analysts at Freedom Capital Markets noted.
Private equity analyst Kyle Walters of PitchBook added,
“The EA deal waves the green flag on sponsors resuming mega-deal transactions following several years of fishing for opportunities down market due to market headwinds such as higher borrowing costs.”
Why EA?
EA’s core sports portfolio has been a goldmine for over a decade, thanks to global fandom and steady in-game spending. With Battlefield 6 around the corner and a pipeline projected to generate over $2 billion in incremental bookings by FY28, Benchmark analysts believe the company’s “true earnings power is only beginning to emerge.” Still, they cautioned:
“While the $210 per share offer price may appear compelling … we believe it falls materially short of the company’s intrinsic value.”
Shareholders will receive $210 per share in cash, representing a 25% premium over EA’s pre-deal stock price. EA shares jumped 5% to $202.54 in midday trading after the announcement.
High Stakes, High Risk
History hasn’t always been kind to mega buyouts. TXU Energy, Toys “R” Us, and Hertz all collapsed post-LBO. But PIF and its partners are betting big on gaming as a long-term growth engine.
If the transaction closes — expected by FY2027 — EA will remain headquartered in Redwood City, California, with CEO Andrew Wilson continuing to lead. Both sides face steep penalties if the deal unravels: a $1 billion breakup fee applies to EA if it backs out, and to the consortium if regulatory delays or breaches derail the process.
For now, one thing is clear: gaming has never seen a power move quite like this.
