"In an move notable for its size, though certainly not its content, a group of investors-including Saudi Arabia's Public Investment Fund, private equity firm Silver Lake, and Jared Kushner's firm Affinity Partners-have purchased EA for $55 billion. It's the second-biggest acquisition in video game history, after Microsoft's $68.7 billion absorption of Activision Blizzard, but unlike that monstrosity, which was subject to antitrust regulations, this feels like a done deal, a straight purchase of one of gaming's biggest and worst studios."
"As if that top-line news isn't bad enough, the acquisition is a leveraged buyout, thanks to $20 billion from JPMorgan Chase. I am not a financial expert, but my understanding ( thank you Matt Levine!) is that the bank is loaning this unholy consortium the money to actually make the purchase, and then EA's assets are collateral towards the loan."
Electronic Arts was purchased for $55 billion by a consortium including Saudi Arabia's Public Investment Fund, Silver Lake, and Affinity Partners. The deal is the second-largest in gaming history after Microsoft's Activision Blizzard acquisition. The transaction is a leveraged buyout that uses a $20 billion JPMorgan Chase loan with EA assets as collateral. The resulting debt and private equity control will pressure EA to generate cash to satisfy investors and repay loans. The Public Investment Fund becomes the main stakeholder and has funneled $2 billion into Affinity Partners. Anticipated outcomes include flashy investments coupled with budget cuts and the gutting of core operations.
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