BREAKINGVIEWS-Saudi’s epic EA bet is easier to fund than justify
Saudi Arabia's Public Investment Fund (PIF) is investing $36 billion to take Electronic Arts private, owning 93.4% of the company. The investment is part of a $55 billion buyout with Silver Lake and Affinity Partners. Despite having the funds, the risks and opportunity costs are high.
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)
By George Hay
LONDON, Dec 3 (Reuters Breakingviews) - The kingdom’s Public Investment Fund is footing the vast majority of a $36 bln equity cheque to take the US video game developer private. With over double that in liquid assets, it has the dough. But the risks and opportunity cost of such a big wager are eye-wateringly high.
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CONTEXT NEWS
Saudi Arabia’s Public Investment Fund (PIF) will own the vast majority of Electronic Arts, following its $55 billion buyout in partnership with Silver Lake and Jared Kushner’s Affinity Partners, the Wall Street Journal reported on December 2.
A November filing with Brazil’s antitrust regulator shows PIF would own 93.4% of EA, the WSJ reported, while Silver Lake and Affinity would own 5.5% and 1.1% respectively. That implies that PIF will fund almost all of the $36 billion equity cheque. (Editing by Neil Unmack; Production by Oliver Taslic)
