Electronic Arts (EA), the iconic video game publisher behind global franchises like Battlefield and FIFA, is set to be taken private in a landmark $55 billion leveraged buyout. The transaction, announced Monday, will be led by a consortium comprising private equity powerhouse Silver Lake, Saudi Arabia’s Public Investment Fund (PIF), and Affinity Partners, the investment firm founded by Jared Kushner.
This deal marks the largest leveraged buyout in history, surpassing the previous record set by TXU Energy in 2007, and eclipsing other major transactions from that era such as Toys “R” Us and Hertz. It also signals a resurgence in global mergers and acquisitions, fueled by declining interest rates and renewed investor appetite for large-scale deals.
Under the terms of the agreement, EA shareholders will receive $210 per share in cash, representing a 25% premium over the company’s closing stock price on September 25, prior to reports of the deal. The transaction carries an equity value of $52.5 billion, with the remaining $2.5 billion attributed to assumed debt and other financial considerations.
The buyout will be financed through a combination of approximately $36 billion in equity contributions from the consortium and $20 billion in debt financing arranged by JPMorgan. Of the debt, $18 billion is expected to be funded at closing, with the remainder available as needed. Additionally, the PIF will roll over its existing stake in EA as part of the transaction.
The timing of the acquisition is critical for EA, which is navigating a challenging period in the gaming industry. Consumer spending on games has become more selective, and EA is relying heavily on its flagship sports titles and shooter franchises to maintain momentum. The upcoming release of Battlefield 6 is expected to be a major catalyst, reinforcing the value of EA’s intellectual property.
Benchmark analysts, however, expressed skepticism about the offer price. “While the $210/share offer may appear compelling, we believe it materially undervalues EA’s intrinsic worth,” they noted. “With Battlefield 6 on the horizon and a content pipeline that could generate over $2 billion in incremental bookings by FY28, EA’s true earnings potential is only beginning to surface.”
EA’s sports portfolio, including titles like Madden NFL and EA FC, has consistently delivered strong recurring revenue, thanks to robust in-game spending and global fan engagement.
The transaction is expected to close in the first quarter of EA’s 2027 fiscal year, pending regulatory approvals and shareholder consent. To safeguard the deal, both parties have agreed to a $1 billion termination fee under specific conditions:
- EA must pay the fee if it backs out due to a board reversal, accepts a superior offer, or pursues another deal within a year of shareholder rejection.
- The consortium must pay the same amount if regulatory delays push the closing beyond September 28, 2026, or if it breaches the agreement.
