Yesterday, we were all surprised when it became official that Electronic Arts was to be acquired and go private all because of a deal being brokered between the Saudi Arabian Public Investment Fund (PIF), Silver Lake, and Affinity Partners (owned by Donald Trump's son-in-law Jared Kushner) and valued at a whopping $55 billion.
When the news broke, it was also regarded as a bit of a record because of it being the largest "all-cash transaction" in the video game space to date, suggesting that the partner consortium had the money on hand to buy EA tomorrow, if the approval process was already completed and which it is not, but is expected to be concluded in Q1 of fiscal year 2027.
This itself seems to be a bit of a trick statement, because while a good amount of money is ready to be put forward to take EA private, a new report from the Financial Times (thanks, Insider Gaming), states that a loan is being taken out to get the deal across the line.
The report talks about how the new owners hope artificial intelligence will eventually boost EA's profits in the years that follow, all by cutting operating costs "significantly". It also notes that the cost-cutting will be necessary to "manage a large debt load on a company that historically carried limited net debt," which all but confirms that a loan will need to be taken out to complete the immense transaction.
The idea of cutting operating costs and using AI to increase profits does also seem to suggest that layoffs and restructuring will eventually happen as part of this deal, all as the acquisition consortium looks to regain the value and wealth that they are putting aside to bring EA into their larger portfolios.