We already knew that three companies would be behind the transaction, but the specifics were still unclear.
In October, when Electronic Arts announced that it would be taken private in a $55 billion leveraged buyout, three investment firms were named as the buyers: Saudi Arabia’s Public Investment Fund (PIF), Jared Kushner’s Affinity Partners, and Silver Lake. The distribution of ownership shares was not disclosed at the time, but it turned out that one party invested significantly more money than the others.
According to the Wall Street Journal, PIF will own 93.4% of Electronic Arts. This is a substantial proportion compared to the smaller shares held by the other investors. Silver Lake and Affinity Partners will own 5.5% and 1.1%, respectively; PIF is a significant investor in both. If the buyout receives regulatory and shareholder approval, PIF will effectively become the owner of Electronic Arts.
The WSJ lists additional details about the transaction that are now public thanks to documents filed with Brazil’s antitrust regulator. Of the $55 billion cost, $36.4 billion will be financed with equity, and the remaining $20 billion will be financed with debt. After deducting PIF’s existing $5.2 billion stake in Electronic Arts, it appears that PIF has invested approximately $29 billion to acquire the publisher. PIF’s substantial investment is not surprising: the fund is known for its investments in the gaming industry and holds stakes in Take-Two, Capcom, Nexon, Nintendo, and others.
However, given the high stakes, it seems increasingly unlikely that Electronic Arts’ values and commitment to gamers and fans worldwide will remain unchanged, as CEO Andrew Wilson said in October. PIF itself is struggling with financial difficulties, mainly due to the construction of a futuristic megacity in the desert. Therefore, it is not the gaming industry that has spent so much money.
