REDWOOD CITY, Calif. Electronic Arts Inc. (NASDAQ: EA) (“EA” or the “Company”), a global leader in interactive entertainment, today announced that it has entered into a definitive agreement to be acquired by an investor consortium (“the Consortium”) comprised of PIF, Silver Lake, and Affinity Partners in an all-cash transaction that values EA at an enterprise value of approximately $55 billion. The transaction positions EA to accelerate innovation and growth to build the future of entertainment.
Under the terms of the agreement, the Consortium will acquire 100% of EA, with PIF rolling over its existing 9.9% stake in the Company. EA stockholders will receive $210 per share in cash. The per share purchase price represents a 25% premium to EA’s unaffected share price of $168.32 at market close on September 25, 2025, the last fully unaffected trading day, and a premium to EA’s unaffected all-time high of $179.01 at market close on August 14, 2025.
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Does EA need to become privately owned? I mean, it does “OK” financially and the acquisition being done with the help of a 20 billion loan will surely put pressure onto the company to increase profits, most likely at the expense of developers who are already spread thin (see reported BF6 development woes)
Generally speaking, a privately-owned company doesn’t have the same incentives to maximize profits at all costs since there are no public shareholders to benefit. However, one doesn’t buy a company significantly above its current valuation to lower its profits.
Also what’s important here is who’s going to own it, and it’s a pretty controversial group.
Oh yes, I did not mean to undermine the worrisome aspect of the new owners, I just struggle to understand why EA would agree to the financial operation in the first place.
Cashing out with a 25% bonus on your stock, well above it’s highest point ever, sounds like a pretty significant sway.