Publishers and gaming studios being bought up is nothing new. Just a few years ago Microsoft acquired Activision Blizzard for a whopping $68.7 billion. Now, EA might be the next big game publisher to be bought out, and fans aren’t happy with the potential new owners.
EA: Who Is Said to be Involved in Buyout?
The potential EA deal, as reported by the Wall Street Journal, would involve multiple parties, with technology investor Silver Lake, Jared Kushner’s Affinity Partners and Saudi Arabia’s Public Investment Fund (PIF) named. According to the reports, the overall deal would cost $50 billion and would be the biggest leverage buyout in history.
What is a Leveraged Buyout (LBO)?💡
A leveraged buyout (LBO) is when a company is bought using mostly borrowed money, with the company’s own assets or future profits used as collateral to repay the debt. It’s a common private equity strategy for acquiring large companies without needing much upfront cash.
While nothing has been officially revealed, sources believe that it could be announced by the end of the week. “EA does make sense as an acquisition target – the cash flows are fairly consistent and EA’s annualized titles make for predictable revenue/profitability,” D.A. Davidson & Co analyst Wyatt Swanson explained via Reuters. If the deal does go through, it would mean that the publisher would be privatized.
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Fans Share Disappointment Online
Of course, with such big news coming to light, fans will quickly flock to Reddit to express their feelings. Overall, the sentiment isn’t all too positive, with many wondering whether a leverage buyout is a good thing or would lead to fewer unique games in the future. One user wrote, “I’m here to tell you this would be bad. Mass Effect 4 would be dead immediately, followed shortly by Bioware being completely dissolved.”
The involvement of Saudi Arabia in the deal also has some fans worried. The country has been trying to sportswash it’s image by creating the yearly esports World Cup, while also hosting other worldwide events like the 2023 Saudi Arabian Grand Prix and acquiring Newcastle United in the UK. So, fans are worried this purchase will give them more opportunities for their own propaganda, as one user worried, “it’ll get thrown in the pile of money dumps used as Saudi propaganda. Next Battlefield will have Saudi as the good guys and FIFA will have a DLC for the Saudi World Cup that makes them sound like a paradise.”
For now, nothing official has been revealed, though news like this tends to move quickly once there are rumors. We’re going to have to be patient to find out more about the potential EA acquisition and what it’s going to mean for popular franchises like Battlefield or EA FC.
Sources: Wall Street Journal; Reuters; Reddit u/Woozlle; Reddit u/Not_My_Emperor