Saudi Takeover of EA in $55 Billion Deal Raises Serious Concerns (nerds.xyz)
- Reference: 0179579246
- News link: https://games.slashdot.org/story/25/09/29/134259/saudi-takeover-of-ea-in-55-billion-deal-raises-serious-concerns
- Source link: https://nerds.xyz/2025/09/saudi-takeover-of-ea-in-55-billion-deal-raises-serious-concerns/
> Electronic Arts has [2]agreed to a $55 billion buyout by Saudi Arabia's Public Investment Fund (PIF), private equity firm Silver Lake, and Jared Kushner's Affinity Partners, marking the largest all-cash sponsor take-private deal ever. Shareholders will receive $210 per share, a 25 percent premium over EA's unaffected price, and once the transaction closes the company will be delisted from public markets. EA CEO Andrew Wilson will remain in charge, with the group arguing that private ownership will allow the publisher to innovate faster and expand its global footprint.
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> The deal, however, is already sparking controversy. PIF, a sovereign wealth fund controlled by the Saudi government, will effectively gain control of one of the most influential names in gaming. While investors stand to profit, many gamers and industry watchers are concerned about how Saudi ownership could shape EA's creative direction, monetization strategies, and role in esports. With regulatory approvals still pending, the takeover raises difficult questions about the intersection of gaming, politics, and global soft power.
[1] https://slashdot.org/~BrianFagioli
[2] https://nerds.xyz/2025/09/saudi-takeover-of-ea-in-55-billion-deal-raises-serious-concerns/
Let the Saudi's buy it (Score:1)
I'm no fan of the Saudi's which is precisely why I say let them buy the company. EA hasn't been relevant to any gaming I've been doing for over a decade now and I'm not overly concerned with what "creative direction" they take with their sports games, the only thing that has kept EA afloat.
Soverign Wealth Fund (Score:5, Informative)
Elon Musk is often cited as the wealthiest man in the world. Most of his capital, however, is tied up in stocks and investments. On paper, it's worth a lot of money, but it's not liquid.
Mohammed bin Salman controls the Saudi Public Investment Fund entirely, and is now also the de-facto ruler of the country itself. He has access to his family's wealth, which is tens of billions of dollars in liquid capital, but also controls the PIF, which has access to trillions.
What this means, is that if a royal family member wants an apartment in NYC, they don't buy an apartment, the PIF buys an entire apartment building and they take over four or five floors. If they want a plane, the PIF buys Saudia an Airbus 380-800 and builds them a private gate. Jealous that Emirates has more cachet than Saudia? They start up a new ultra-luxury airline, with customized planes and all new gates in a dozen airports. If a royal family member likes golf, they start their own league. A family member likes soccer, they buy a chunk of the Premier League.
Elon Musk, by any metric, has a lot of money. Sovereign wealth is in another category altogether.
Re: (Score:2)
Well, you are comparing a person to a nation, so I would expect the latter to have a few more resources.
Nation (Score:3)
Saudi Arabia is an absolute monarchy. The royal family are the nation. We only vaguely know how much money they have because they don't need to report it, as they are not taxed. They get *all* revenue from state-owned enterprises then distribute money to the government as they see fit. They keep their money in banks that they own governed by laws that they make.
Brunei has the same situation. The sultan was traditionally the richest man in the world.
Re: (Score:2)
Saudia doesn't have any A380. The only airline that can make them work is Emirates anyway.
Re: (Score:2)
Both people are also good examples why you can be an utterly crappy person, despite/because having tons of money.
Re: (Score:2)
> If they want a plane, the PIF buys Saudia an Airbus 380-800 and builds them a private gate.
Citation needed. Zero A380s are owned by anything Saudi. The middle eastern companies that own A380s are Air Emirates, Etihad Airways, and Qatar Airways. These are not Saudi.
At this point, buying an A380 would be stupid. Buying other planes would make more sense.
It's a leveraged buyout (Score:3)
That means they aren't actually buying it they are forcing the company to take on massive amounts of debt and then paying themselves out of that.
I don't have a huge amount of love for electronic arts but they do occasionally put out an actual game instead of a Skinner box. This is basically going to destroy them.
It's possible Saudi Arabia actually wants to own and run the company. They know that one way or another oil sales are going to go down. And I need those sales to buy weapons to defend themselves against their neighbors that they're always pissing off.
On the other hand when EA very likely collapses maybe somebody else will finally get a shot at making a football game. I mean it's been what something like 20 years since we've had anyone else thanks to the exclusivity deal.
Still it absolutely boggles my mind that leveraged buyouts are legal. We have lost tons of companies and hundreds of thousands of jobs to them. But heaven forend we do anything against capitalism.
All-Cash (Score:2)
it's an all-cash deal. No leveraged buyout. The PIF is sitting on trillions of dollars of liquid capital. The Saudis don't need to take out loans to buy stuff.
Re: (Score:3)
If you read the article, "The deal is expected to close in the first quarter of fiscal 2027, pending regulatory and shareholder approval. Financing will come from $36 billion in equity and $20 billion in debt arranged by JPMorgan, with $18 billion funded at closing.
I'm not a finance person, so I don't know in what context the "all-cash" wording in the summary might make sense, but the article is pretty clear on that.
Re: (Score:2)
Ah, I guess it's "all-cash" as in existing shareholders will receive all-cash for their shares.
Re: (Score:2)
How are they different from a mortgage? I borrowed money from a bank to buy a house with, and that house serves as collateral on the loan. I don't pay, it gets sold to cover the loan. In a leveraged buyout, you borrow money to cover the purchase cost, and the company becomes the collateral. The buyer owes the debt.
I just don't see the problem. Sometimes you have to take out a loan to buy something. Where are you seeing a problem?
New franchise (Score:1)
Can't wait for Journalist Butchering Simulator 2027!
Re: (Score:2)
> Can't wait for Journalist Butchering Simulator 2027!
Simulator? Hell, why not extend the gaming into the real world via robotics and AI? We're already living in a world seemingly inspired by dystopian Science Fiction. We might as well go whole hog and create the equivalents of movies like Death Race and of historical "games" such as Gladiators vs Lions. Kill your (least) favourite journalist by remote control, and win cash prizes!
Re: (Score:3)
I'm expecting a new Sim City installment where you build a futuristic city in the desert with lots of cheap foreign labour whom you work to death
Buying soft power (Score:5, Insightful)
Saudi Arabia is doing stuff like buying games & entertainment companies, sports events etc to project soft power and white wash their horrible public image. What with murdering opponents and working people to death on their boondoggle projects. I guess the current owners of EA don't give a fuck about any of that. And nor does Jared Kushner.
But but but.. (Score:2)
But I thought free-market capitalism was good?!
Jared Kushner (Score:2)
Oh man Hunter Biden is going to catch so much shit for this. Wait, nobody is calling out how the presidents son in law got this sweet deal? Maybe Kushner will leave a laptop at repair shop with a blind owner. Will MTG show pictures of his dick to congress like she did with Hunter?
Re: (Score:2)
Kushner has been doing this kind of work in the Middle East since before Trump became President. Hell, before he even married into the family.
Re: (Score:2)
> Kushner has been doing this kind of work in the Middle East since before Trump became President. Hell, before he even married into the family.
Bullshit. Citation needed. He dealt (poorly) in NYC real estate, just like his future father-in-law. From [1] [wikipedia.org]:
> For much of his career, Kushner worked as a real-estate investor in New York City, especially through the family business Kushner Companies. He took over the company after his father, Charles Kushner, was convicted for 18 criminal charges
His "investment firm" was just a bribe for pulling the rug over Saudi Arabia's crown prince kidnapping, killing, and dismembering a journalist that was critical of
[1] https://en.wikipedia.org/wiki/Jared_Kushner
Re: (Score:2)
Damn, munged the link: [1]https://en.wikipedia.org/wiki/... [wikipedia.org]
[1] https://en.wikipedia.org/wiki/Jared_Kushner
Re: (Score:1)
I don't care to argue with you. Enjoy your time in the wilderness, it'll be a generation or more before anyone takes you guys seriously again..
Interesting (Score:2)
I assume this is similar to buying news stations, some sort of indirect form of narrative control? That or maybe they really want to fix the stats on FIFA
I agree (Score:3)
> EA CEO Andrew Wilson will remain in charge
This is very concerning