Video Game Giant EA To Be Sold In $50 Billion Mega-Deal

The video game giant Electronic Arts (EA) is in the final stages of a $50 billion deal to go private, according to anonymous sources. If it succeeds, it would become one of the largest buyouts in history.

According to the Wall Street Journal, sources familiar with the matter said that the group of investors involved in the negotiation includes Jared Kushner’s investment firm Affinity Partners, Saudi Arabia’s Public Investment Fund (PIF)—which already owns 10% of EA—, and private-equity firm Silver Lake.

Saudi Arabia’s interest in the acquisition has to do with the country’s strategy to reduce dependence on oil and its focus on video games—in 2021, it launched Savvy Games Group to invest in esports and video games. PIF also holds stakes in other major gaming companies, including Activision Blizzard.

EA has created hugely popular franchises such as EA Sports FC (formerly known as FIFA), Madden NFL, Need for Speed, and The Sims, which recently celebrated its 25th anniversary. Over the past decades, EA has built a strong legacy and established itself as one of the largest video game companies in the world. However, the potential acquisition raises concerns in the gaming industry.

According to Bloomberg, this massive deal may reflect challenges in the industry, which is currently experiencing slower growth. The acquisition has been seen by experts as part of a trend toward consolidation, as gamers appear more inclined to revisit established favorites rather than adopt new titles.

“We’re moving away from an era of breaking new ideas to people settling into the same games, spending money over and over again,” said analyst and Spilt Milk Studios co-founder Nicholas Lovell to Bloomberg. The expert also suggested that EA’s valuation could begin to decline soon.

According to CNBC, after news of the $50 billion deal broke on Friday—one of the largest in Wall Street history—EA shares jumped about 15%. The deal is expected to be officially announced later this week.