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Tag: Public Investment Fund

  • US Congress members call for ‘thorough review’ of EA’s $55 billion sale

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    Before Electronic Arts goes private in a groundbreaking sale, some US lawmakers are pleading for some federal oversight. Democratic members of the US Congress, as part of the Congressional Labor Caucus, penned a letter asking the Federal Trade Commission to “thoroughly review” the $55 billion acquisition of EA.

    EA confirmed the sale to the Public Investment Fund, or the sovereign wealth fund of Saudi Arabia, Silver Lake and Affinity Partners in September, but the deal is expected to close in the first quarter of 2027. Before the official change of ownership, the 46 House Democrats who signed the letter to the FTC are calling for more scrutiny into the impacts of the deal.

    The letter noted some of the most consequential effects, including the worsening of an unstable industry, the potential for more layoffs and increased market dominance for EA. “We respectfully urge the Commission to conduct a thorough investigation into the labor market consequences of this proposed acquisition, including EA’s existing wage-setting power, the likelihood of post-transaction layoffs, the degree of labor-market concentration in relevant geographic and occupational markets, and the role of cross-ownership in shaping labor outcomes,” the letter read.

    The letter already earned support from the Communications Workers of America union, who also supported a petition from the United Video Games union. As spotted by Eurogamer, the petition calls on regulators and elected officials to “scrutinize this deal and ensure that any path forward protects jobs and preserves creative freedom.”

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    Jackson Chen

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  • EA reportedly plans to go private with help from Silver Lake and Saudi Arabia

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    Electronic Arts is close to reaching a $50 billion deal that will turn it into a privately held company, according to The Wall Street Journal. The video game company filed for an IPO way back in 1990 and has been public ever since, but now a group of investors are in talks with the company to take it private. Those investors reportedly include private equity firm Silver Lake, Saudi Arabia’s Public Investment Fund (PIF) and Jared Kushner’s Affinity Partners, whose largest source of funding is also Saudi’s PIF.

    It’s worth noting that EA’s shares are already tied to major financial organizations, even though it’s publicly traded, with Saudi’s PIF owning almost 10 percent of the company. As Reuters notes, analysts believe Saudi is interested in buying out EA due to its annual release of popular sports titles, including Madden and NHL, which makes for predictable earnings.

    Saudi has made several major investments in the video gaming industry overall as part of its efforts to prepare for a post-oil economy. In addition to its investment in EA, it also purchased stakes in Take-Two Interactive, Activision Blizzard, Nintendo and the Embracer Group. In March, Pokémon Go maker Niantic sold its gaming division to a Saudi-owned company, as well. Unlike PIF and Kushner’s Affinity Partners, Silver Lake doesn’t have a huge stake in EA at the moment and doesn’t have notable gaming investments other than its stake in Unity.

    Bloomberg and The Financial Times report that the company could announce the buyout as soon as next week, but details could change since nothing has been finalized yet. If the $50 billion deal does push through, it’ll become the biggest leveraged buyout of all time.

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    Mariella Moon

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