‘Game-Changing Deal’: EA Set for $55bn Take-Private in Largest LBO Ever

Pending regulatory approval in multiple jurisdictions – including anticipated CFIUS review¹ – video game giant Electronic Arts has agreed to be taken private in the largest leveraged buyout in history. Saudi Arabia’s Public Investment Fund has joined Silver Lake and Affinity Partners in acquiring the publisher at an enterprise valuation of around $55bn.²

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Approximately $20bn of this will come through debt financing fully and solely committed by JPMorgan Chase, implying around 6x gross leverage (debt/EBITDA) at closing on CreditSights’ FY27E forecasts.³ While this may appear a high debt/EBITDA ratio for a videogame company, law firm Bird & Bird has noted that EA’s roughly $7.5bn of annual net revenue is underpinned by a highly recurring profile, with over 70% of net bookings coming from live services and other ongoing spend (such as subscriptions and in-game purchases)⁴ – making the business less reliant on one-off game releases to service its debt.

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Upon completion, EA will remain headquartered in Redwood City, California and Andrew Wilson will continue as CEO.⁵ Silver Lake Co-CEO and managing partner Egon Durban commented: “We are honored to invest and partner with Andrew – an extraordinary CEO who has doubled revenue, nearly tripled EBITDA, and driven a fivefold increase in market cap during his tenure.”⁶

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On the legal side, EA is being advised by Wachtell, Lipton, Rosen & Katz. Kirkland & Ellis is serving as lead counsel to the consortium, supported by specialist counsel Gibson, Dunn & Crutcher. Silver Lake is represented by Latham & Watkins and Simpson Thacher & Bartlett, while Sidley Austin is advising Affinity Partners.⁷