Electronic Arts is Bought for More than 55 Billion Dollars

Electronic Arts, one of the most important companies in the sector, has just announced an agreement to be acquired by a consortium made up of the Public Investment Fund of Saudi Arabia (PIF), Silver Lake, and Affinity Partners. This was officially reported through a press release detailing some specifics of the agreement, such as the amount of the operation, which exceeds 55 billion dollars, of which 36 billion constitute an equity investment and the remaining 20 billion debt financing. The transaction has already been approved by EA’s Board of Directors and is expected to close in the first quarter of 2027. It is, as usual, subject to shareholder approval and required regulations. Once completed, EA will become completely private and will no longer be listed on any public market.

PIF in the video game industry

The news of the purchase may have taken most of the public by surprise, but the reality is that the Public Investment Fund of Saudi Arabia was already one of EA’s majority shareholders with 9.9% of its shares. Moreover, this is not its only investment in this market, as the PIF holds shares in several of the most thriving companies in the industry:

Activision Blizzard, Take-Two, and Electronic Arts

In February 2021, the fund invested 3.3 billion dollars in purchasing shares in three of the most powerful companies in the sector. In an article published by the outlet Arab News, the following investments are detailed:

The PIF acquired 15 million shares of Activision Blizzard, representing 3.5% of the company’s total shares, for a value of 1.39 billion.
They also acquired 3.97 million shares of Take-Two, representing 3.5% of the total, for a value of 825.5 million dollars.
Simultaneously, they bought 7.42 million shares of Electronic Arts, 2.6% of the total at that time, for one billion.

Capcom and Nexon

In February 2022, the fund acquired 5% of Capcom’s shares and a little over 5% of Nexon’s shares after a combined investment of more than 1 billion dollars. Of this amount, 332 million were allocated to the purchase of Capcom shares and 883 million to the Korean publisher. According to the outlet Middle East Monitor, this purchase would be a “pure investment,” and a possible acquisition of any of the companies is not anticipated.

Nintendo

In May 2022, Kotaku reported a new investment by the fund in the video game industry—in this case, the acquisition of 5% of all Nintendo shares. This purchase was gradual and is estimated to have a cumulative cost of about 378.764 billion yen, that is, more than 2.7 billion euros (according to the exchange rate at that time). Subsequently, they increased their stake to become one of the group’s largest shareholders, accumulating just over 8% of the total shares, according to Forbes.

SNK

Also in May 2022, the Mohammed bin Salman Foundation (Misk), founded by the Saudi Crown Prince himself, officially announced the acquisition of 96% of SNK through its subsidiary Electronic Games Development Company. The EGDC receives investments from the Public Investment Fund of Saudi Arabia; therefore, the purchase of this legendary Japanese studio adds to the fund’s list of properties.

Embracer Group

In June 2022, the PIF made an investment of 840 million pounds sterling (about 975 million euros at the June 2022 exchange rate) through the subsidiary Savvy Gaming Group to acquire 8% of the shares and 5.4% of the votes within the Swedish fund.