The Sims publisher will go private at a $55 billion valuation, shares jumped

Video game developer Electronic Arts will go private: its shares will be bought by a consortium of investors with a valuation of the entire business at $55 billion. The consortium includes Silver Lake Fund, the investment company of former Donald Trump adviser Jared Kushner Affinity Partners and a Saudi Arabian sovereign fund (PIF), according to a statement on the company's website.

According to a statement on Monday, the agreement values Electronic Arts shares at $210 apiece. That represents a 25% premium to the closing price on Sept. 25 - before initial reports of the deal surfaced. Electronic Arts' share price jumped more than 5% to about $204 on the U.S. premarket on Sept. 29.

Financing for the deal involves $36 billion in equity from a consortium of buyers, including the conversion of PIF's existing 9.9% stake in EA shares, as well as a $20 billion loan to be provided by JPMorgan.

This is the largest ever leveraged buyout of a company, the Financial Times notes. In terms of volume, such a deal will exceed the record buyout of Texas utility group TXU for $45 billion in 2007, which until then remained the largest example of a deal to transfer the company into private ownership.

The deal represents a major bet that artificial intelligence technology can significantly reduce EA's operating costs, allowing the consortium to deal with the large debt load of the company, which previously had minimal net debt, writes the FT. Artificial intelligence can be used in game development: for example, to replace voice actors, create backgrounds and other elements, as well as to automate testing to identify bugs before release, the newspaper said.

According to sources familiar with the deal, investors are hoping that cutting costs through the use of AI will significantly boost EA's profits in the coming years, the publication said.

By going private, EA will be able to restructure its processes without the pressures of investor and public reporting that often force companies to chase short-term results to meet quarterly goals, AP writes. While EA's games still retain loyal fans, its annual revenue has stagnated in the range of $7.4 billion to $7.6 billion over the past three fiscal years.

After leaving the White House, Trump's son-in-law Jared Kushner founded the investment company Affinity Partners, one of the largest investors in which was the Saudi sovereign fund PIF, writes FT. According to the newspaper's sources close to the negotiations, Kushner's participation should facilitate the passage of the deal through the Committee on Foreign Investment in the United States (CFIUS), which considers deals involving foreign buyers.

PIF has ambitious plans to channel up to $70 billion annually from Saudi Arabia's oil revenues into sectors such as technology and real estate. The fund has already been one of the largest public shareholders of EA, as well as holding stakes in gaming companies Nintendo and Take-Two Interactive.

As for Silver Lake, this is the second high-profile deal involving it and a tech company with a large army of fans in recent weeks, AP notes. Silver Lake, as reported by Bloomberg, Reuters and other business media sources, along with IT giant Oracle, will be among the main investors in a joint venture that will take a stake in the TikTok video service business in the United States.

Electronic Arts is known for developing video games: some of the most popular include the soccer simulation game FIFA (now called FC), The Sims series, and several games based on the Star Wars universe, including Star Wars Jedi: Survivor. The company was founded by former Apple employee Trip Hawkins and began creating video games in the early 1980s.

EA stock is up 32% since the start of 2025. The stock has a total of 30 ratings from analysts and most advise to hold.

This article was AI-translated and verified by a human editor