The gaming powerhouse Electronic Arts (EA) is reportedly on the brink of being sold in a monumental deal valued at $50 billion to an investment group including private equity and the Public Investment Fund of Saudi Arabia. This major event could reshape the future of EA, moving it away from public trading.

As per a report from The Wall Street Journal, the agreement is anticipated to be finalized soon, potentially leading to the largest leveraged buyout in history. While the reported price tag approaches EA’s estimated market value of $43 billion, it remains unconfirmed.

The combination of significant debt attributed to this purchase creates potential risks, as past leveraged buyouts have led to significant layoffs and even closures in the industry. Notably, investors like Silver Lake and state-owned funds from Saudi Arabia are expected to spearhead this acquisition.

This acquisition follows EA’s challenges in maintaining its competitive edge amid increasing consolidation within the gaming sector, especially against the likes of Microsoft and Sony, alongside the rise of independent developers. EA’s previous loss of the FIFA license and the struggles of its notable studio BioWare further illustrate the company’s tumultuous past.

The following franchises may see changes if the sale goes through:

• Mass Effect and Dragon Age (BioWare)
• Apex Legends and Titanfall (Respawn)
• The Sims 4 (Maxis)
• Madden NFL and several other EA Sports titles.

Critics have pointed to Saudi Arabia’s growing influence in global entertainment as a means to distract from its human rights record, a practice they term ‘sportswashing’.

This phase in EA’s history is marked by uncertainty as the company navigates the complexities of potential acquisition, especially amidst evolving market dynamics.