It’s official – Electronic Arts shareholders have overwhelmingly approved the company’s $55 billion sale to a consortium led by Saudi Arabia’s Public Investment Fund. The vote, held on December 22, 2024, wasn’t even close. Over 201 million votes supported the acquisition versus just 1.9 million against and 90,000 abstentions, according to SEC filings. After 37 years as a publicly traded company, EA is going private in the largest leveraged buyout in history.
Current EA shareholders will receive $210 per share, representing a 25 percent premium on the company’s September 25, 2025 closing price. But this windfall for investors comes with massive risks for the company itself. The deal saddles EA with approximately $20 billion in debt, money borrowed by the acquiring consortium to finance the purchase. That debt burden, combined with ownership by a regime with a troubling human rights record, has developers, fans, and industry observers deeply concerned about EA’s future.
The Vote Breakdown – Not Even Close
The shareholder vote revealed just how financially attractive this deal is for current EA investors. With over 99 percent approval, shareholders made clear they’re cashing out at the premium price rather than worrying about the company’s long-term health under new ownership. When you’re offered 25 percent above current market value, most investors take the money and run.
A separate vote on executive compensation following the deal’s close also passed decisively, though slightly less overwhelmingly. That vote saw 1,278.3 million shares vote in favor, 25 million against, and 254,000 abstentions. EA executives stand to receive substantial payouts if and when the acquisition closes, incentivizing leadership to ensure the deal goes through regardless of potential long-term consequences for employees or franchises.
CEO Andrew Wilson, who will remain in his position after the acquisition, stated in September that EA’s values will “remain unchanged” under Saudi ownership. This assurance rang hollow for many, given that the deal’s primary stakeholder is Crown Prince Mohammed bin Salman, widely believed to have ordered journalist Jamal Khashoggi’s murder and dismemberment in 2018.
Who’s Actually Buying EA?
The acquisition splits ownership unevenly among three entities, with Saudi Arabia’s Public Investment Fund controlling the vast majority. The PIF, Saudi Arabia’s sovereign wealth fund headed by Mohammed bin Salman, will own a staggering 93.4 percent of EA once the deal closes. This makes EA essentially a Saudi state-owned enterprise masquerading as a private company.
California-based private equity firm Silver Lake receives 5.5 percent ownership. Silver Lake has significant gaming industry experience, having invested in Endeavor Group (which owns esports organization ESL) and entertainment companies more broadly. However, their minority stake gives them little actual control over EA’s direction.
Affinity Partners, the private equity firm owned by Jared Kushner (Donald Trump’s son-in-law), holds the remaining 1.1 percent. Affinity Partners is itself primarily funded by Saudi Arabia, making the ownership even more concentrated in Saudi hands than the percentages initially suggest. Kushner’s involvement adds another layer of political complexity, particularly given his close ties to both the Saudi government and the incoming Trump administration.
The PIF has been aggressively investing in gaming for several years as part of Saudi Arabia’s Vision 2030 initiative to diversify the kingdom’s economy beyond oil. Through the PIF and subsidiary Savvy Games Group, Saudi Arabia has purchased stakes in Nintendo, Take-Two, Capcom, Nexon, Embracer Group, and ESL. They’ve also funded LIV Golf and purchased Newcastle United FC, investments critics label as “sportswashing” – using entertainment to distract from the government’s human rights abuses.
The Leveraged Buyout Trap
What makes this deal particularly dangerous for EA is its structure as a leveraged buyout. In these transactions, acquiring companies borrow massive sums to finance purchases, then use the acquired company as collateral for that debt. This effectively transfers the debt burden from the buyers to the purchased company.
EA will inherit approximately $20 billion in debt from this acquisition. The company must generate enough revenue not just to fund operations and development, but to service that enormous debt load. If EA’s income can’t adequately cover debt payments, the consequences fall on EA – not the investors who arranged the purchase. That usually means layoffs, studio closures, and slashed budgets for game development.
History provides cautionary tales. Toys R Us, once ubiquitous, eventually declared bankruptcy and closed after a leveraged buyout left it unable to service debt while competing with online retailers. In gaming specifically, Microsoft cut 1,900 jobs shortly after its Activision Blizzard acquisition, with Blizzard Entertainment heavily affected. While Microsoft’s deal wasn’t technically a leveraged buyout, it demonstrates how acquisitions frequently lead to mass layoffs regardless of promises to the contrary.
The one potential safeguard is Saudi Arabia’s essentially unlimited wealth. The PIF manages over $700 billion in assets. Unlike typical private equity firms that ruthlessly extract value and abandon failing investments, Saudi Arabia can theoretically absorb losses indefinitely if EA struggles. Whether they’ll choose to do so remains the critical unknown.
What Happens to EA’s Games and Studios?
EA owns some of gaming’s biggest franchises and most talented studios. Battlefield, Mass Effect, Dragon Age, The Sims, Apex Legends, EA Sports FC (formerly FIFA), Madden NFL, and Need for Speed all fall under EA’s umbrella. Studios like DICE, BioWare, Respawn Entertainment, Motive Studio, and Criterion Games employ thousands of developers who’ve created beloved games for decades.
What becomes of these franchises and teams under Saudi ownership? In theory, going private could benefit EA by removing pressure to meet quarterly earnings targets. Public companies face relentless demands from shareholders to maximize short-term profits, often at the expense of long-term creative vision. Private ownership theoretically allows focus on building great games without Wall Street scrutinizing every quarter.
But that optimistic scenario assumes the new owners prioritize quality over profitability, which history suggests is unlikely. The $20 billion debt burden creates opposite incentives – EA must generate maximum revenue as quickly as possible to service debt. That typically means aggressive monetization, risk-averse sequels over innovative new IPs, and cost-cutting that impacts development budgets and staffing.
EA’s recent performance makes the situation more precarious. BioWare was sharply downsized after Dragon Age: The Veilguard underperformed commercially. EA lost the lucrative FIFA license, forcing rebranding to the generic EA Sports FC. Multiple projects were cancelled. The upcoming Battlefield 6, which showed strong beta numbers and positive critical reception, represents a crucial test of whether EA can still deliver hits under pressure.
The Brain Drain Risk
Many EA developers have expressed concerns about working for a company owned by the Saudi government. Some may leave on principle, unwilling to create entertainment for a regime with extensive human rights violations. Others may depart if working conditions deteriorate under new ownership focused on debt repayment over developer welfare.
Talent exodus would devastate EA’s studios. Game development requires institutional knowledge accumulated over years. When experienced developers leave, they take understanding of proprietary tools, franchise lore, technical systems, and collaborative relationships. Replacing them costs time and money while often producing inferior results. If this acquisition triggers significant departures from key studios like Respawn or DICE, EA’s ability to deliver quality games will suffer regardless of budget.
The Regulatory Approval Hurdle
Shareholder approval was always a foregone conclusion given the premium offered. The real question is whether US regulators will block the deal. The acquisition requires approval from bodies like the Federal Trade Commission and potentially the Committee on Foreign Investment in the United States, which reviews transactions involving foreign control of American companies.
Under normal circumstances, a foreign government taking control of a major American entertainment company might trigger scrutiny. But circumstances are far from normal. Donald Trump, who takes office in January 2025, has close personal and business relationships with Mohammed bin Salman and the Saudi government. Jared Kushner, Trump’s son-in-law and minority stakeholder in this deal, facilitated much of that relationship during Trump’s previous presidency.
The political dynamics strongly favor approval. The incoming Trump administration is unlikely to block a deal benefiting both Saudi Arabia and Kushner personally. EA can reasonably expect regulatory green lights, allowing the transaction to close by the estimated Q1 FY27 timeline (April-June 2026).
Industry Reaction – Optimism and Dread
Wall Street largely celebrated the deal, with analysts praising the premium paid to shareholders and PIF’s deep pockets. “Wall Street seems generally upbeat about the EA buyout, expecting PIF to draw from its vast resources and drive meaningful value from the transaction,” one analyst noted. For investors focused purely on financial returns, the Saudi-led acquisition looks attractive.
Developers and fans express far more skepticism. Online discussions filled with concerns about censorship, working conditions, and franchise futures under Saudi ownership. Some vowed to boycott EA games entirely if the deal closes, unwilling to fund a regime they view as fundamentally opposed to values like free expression and human rights.
Others adopted a wait-and-see approach, noting that day-to-day operations may not change dramatically. Game development will continue. Franchises will get sequels. The EA logo on the box remains the same. Whether ownership matters depends on how actively involved Saudi Arabia becomes in creative and business decisions.
Industry analysts worry about precedent. If this acquisition succeeds, other countries with sovereign wealth funds may pursue similar gaming acquisitions. China, Qatar, Norway, and others maintain massive investment funds seeking returns. Gaming represents a growing global industry with reliable revenue streams. Nothing prevents foreign governments from buying more publishers if EA’s sale proceeds without resistance.
Frequently Asked Questions
When will the EA acquisition close?
EA expects the deal to close in Q1 FY27, which runs from April through June 2026. The transaction remains subject to regulatory approval, though most expect that approval given political circumstances.
How much are EA shareholders receiving?
Current EA shareholders will receive $210 per share, representing a 25 percent premium over the company’s September 25, 2025 closing price before the deal was announced.
Who will own EA after the acquisition?
Saudi Arabia’s Public Investment Fund will own 93.4 percent of EA. Silver Lake holds 5.5 percent, and Jared Kushner’s Affinity Partners owns 1.1 percent. This makes EA essentially a Saudi state-owned company.
Will Andrew Wilson remain EA’s CEO?
Yes, Andrew Wilson will continue as EA’s CEO after the acquisition closes. He stated in September that EA’s values will remain unchanged under new ownership.
How much debt will EA have after the buyout?
The leveraged buyout will saddle EA with approximately $20 billion in debt, money borrowed by the acquiring consortium to finance the purchase. EA must generate sufficient revenue to service this debt while funding operations.
What games and franchises does EA own?
EA owns major franchises including Battlefield, Mass Effect, Dragon Age, The Sims, Apex Legends, EA Sports FC (formerly FIFA), Madden NFL, Need for Speed, Titanfall, and Plants vs. Zombies, among others.
Can regulators still block the deal?
Technically yes, though approval appears likely given the incoming Trump administration’s close ties to Saudi Arabia and Jared Kushner’s involvement in both the deal and Trump’s inner circle.
What happened to Toys R Us in a leveraged buyout?
Toys R Us filed for bankruptcy and eventually closed after a leveraged buyout left the company unable to service debt while competing with online retailers. The debt burden prevented necessary investments in modernization and infrastructure.
What This Means for Gaming
EA’s sale represents a watershed moment for the gaming industry. One of the world’s largest publishers, owner of beloved franchises spanning decades, is becoming a private company controlled by a foreign government. The implications extend far beyond EA’s immediate future.
If this acquisition succeeds without major regulatory resistance or public backlash, expect other publishers to face similar takeover attempts. Activision Blizzard already merged with Microsoft. Take-Two faces consolidation pressure. Ubisoft’s struggles make it vulnerable. The era of independent major publishers may be ending, replaced by sovereign wealth funds and tech giants competing to control gaming’s most valuable intellectual property.
For EA specifically, the next 2-3 years will determine whether Saudi ownership delivers the promised benefits or predicted disasters. Can EA generate sufficient revenue to service $20 billion in debt while maintaining development quality? Will Saudi Arabia remain hands-off or begin influencing creative decisions? Can EA retain top talent despite working for a controversial government? Will franchises thrive or suffer under new ownership?
The answers won’t arrive until years after the deal closes. By then, EA’s fate – and potentially the broader gaming industry’s trajectory – will already be decided. For now, shareholders celebrate their premium payouts while developers, fans, and industry observers watch nervously, hoping for the best but preparing for the worst.
The vote is in. The deal moves forward. All that remains is waiting to see whether the biggest gaming buyout in history becomes a success story or cautionary tale. Given everything we know about leveraged buyouts, Saudi Arabia’s track record, and EA’s recent struggles, cautious pessimism feels more appropriate than optimism. But stranger things have happened in gaming. Maybe, against all odds, this works out. Don’t bet your favorite franchise on it.