Electronic Arts has announced it has received "all regulatory approvals" for its proposed $55 billion private acquisition. According to an 8K filing with the U.S. Securities and Exchange Commission, the deal is anticipated to close on August 4th. This brings to a close more than a year of debate surrounding the leveraged buyout by Saudi Arabia's Public Investment Fund, in partnership with private equity firm Affinity Partners and investment firm Silver Lake.
The completion of the merger remains contingent on the satisfaction or waiver of remaining customary closing conditions outlined in the merger agreement. A leveraged buyout, which involves a substantial amount of borrowed debt, typically sees the acquired company's income and assets used to repay that debt. This means significant pressure will likely be on EA to perform financially under its new ownership.
While numerous institutions worldwide, including the European Commission and the U.S. Federal Reserve, have approved the merger, the process was not without contention. The U.S. video game union lodged a protest against the deal. EA shareholders had previously approved the acquisition in December, paving the way for its current trajectory.
Critics have raised concerns about Saudi Arabia's human rights record and its increasing financial involvement in the video game industry, with some organizations labeling it as "sportswashing." Additionally, questions have been raised regarding Affinity Partners' CEO Jared Kushner, the son-in-law of former U.S. President Donald Trump, with some speculating his connections may have influenced the smooth passage of the deal through U.S. regulators.
This latest filing comes shortly after reports detailed executive bonus packages at EA, including approximately $38 million in bonuses and company stock awarded to CEO Andrew Wilson in the last fiscal year. The future structure and operational focus of EA under new management remain to be seen, particularly amidst widespread layoffs occurring across the Western gaming industry.