Electronic Arts Goes Private in Monumental $55 Billion Deal, Reshaping Gaming Industry

The renowned video game company, Electronic Arts, has officially welcomed new ownership.

Renowned for blockbuster hits like “Battlefield” and “The Sims,” the California-based gaming titan announced on Tuesday the completion of its monumental $55 billion sale. The new controlling entities include Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), alongside Silver Lake Partners and Affinity Partners, with the latter being managed by Jared Kushner, the son-in-law of former U.S. President Donald Trump.

This acquisition has set a historic precedent as the largest private equity buyout ever recorded in the sector. With the deal now finalized, industry observers are speculating about the potential transformative shifts awaiting the gaming landscape.

In an enthused statement, Andrew Wilson, CEO of Electronic Arts, expressed a commitment to “invest boldly and accelerate innovation,” aiming to craft the next wave of games and experiences that captivate countless gamers globally. Meanwhile, Turqi Alnowaiser, deputy governor and head of international investments at PIF—who has overseen PIF’s minority stake in EA for five years—vowed substantial investment towards EA’s expansion, particularly leveraging artificial intelligence in game creation.

While some analysts view EA’s transition to a private entity as a move that could liberate the company from the relentless pressures of public market demands, other experts caution about the $20 billion in debt burdened onto the deal. Such financial strain raises the specter of potential layoffs and significant cost-reduction strategies looming on the horizon.

And many eyes are on Saudi Arabia’s PIF and Kushner’s Affinity Partners. Critics are wary about what this new ownership could mean for EA games down the road.

“With this deal, Saudi Arabia and Jared Kushner just bought access to 700 million players worldwide,” U.K.-based campaign #BlockTheEADeal wrote in an online petition that previously called on regulators to challenge the buyout. “With the increased use of AI in the creative sector and video games, the potential for data misuse by a Foreign Sovereignty is high and poses significant international security risks.”

In a Tuesday statement, Kushner maintained that EA had “created stories, characters, and communities that have become part of everyday life for hundreds of millions of people” and that Affinity was “excited to support the company as it continues to reach new audiences.”

Meanwhile, organizations like Amnesty International and Human Rights Watch have also been highly critical of Saudi Arabia’s overall investments in sports and esports – with some accusing the nation of “sportswashing” to distract international attention from human rights abuses.

PIF has increasingly upped its gaming investments over the years. Beyond EA, the sovereign fund is also a minority investor in fellow gaming giant Nintendo and has a large esports portfolio, including competitive gaming platforms like ESL FACEIT. EA’s “Madden NFL” and “EA Sports FC” (formerly FIFA) will now also fall under that umbrella.

Now that the transaction is complete, EA stockholders will receive $210 in cash per share. And the company’s stock is no longer trading on the public market.