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Why the $55bn acquisition of Electronic Arts isn't your usual leveraged buyout

Games and finance industry experts weigh in on how EA might change its business with an extra $20bn of debt, and what the real goal of the deal might be

Image credit: Sergei Novikov on Unsplash

Feature

by Alex Forbes-Calvin<br>Contributor

Published on June 10, 2026

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In September 2025, the news broke that a consortium of investors led by Saudi Arabia's Public Investment Fund (PIF) had made an offer to buy Electronic Arts.

The FC Sports giant is being bought for $55 billion by the PIF, Silver Lake, and Affinity Partners, with more than $20 billion in debt financing from US banking behemoth JPMorgan. The deal is set to close by the end of EA's first quarter of fiscal 2027, aka by June 30, 2026.

It's the largest leveraged buyout (LBO) in history. In theory, the newly private company will be able to take bigger risks and think in longer terms as a result of not having to answer to shareholders every quarter, but the way EA is being acquired could have troubling implications for the games firm.

Battlefield 6 was a big seller for EA in 2025. | Image credit: Electronic Arts

An LBO involves an acquisition being partly funded via the acquiring entity taking out a sizeable loan. The debt associated with this loan is then added to the balance sheet of the company that is being acquired.

In the case of Electronic Arts, the company had $1.49 billion in debt as of March 2026; once the deal closes, this figure will grow to north of $20 billion. Over 30% of the deal is being financed through debt.

In a letter to staff, EA stated that its "mission, values, and commitment to players and fans around the world remain unchanged", but with this much additional debt on its balance sheet, that's quite hard to believe.

Paying it back

Depending on who you speak to, this debt serves a different function. It can be a means of maximising returns for the entity buying the company, once it eventually sells it. Alternatively, it acts as a form of fiscal discipline. The company now needs to service the debt, leaving little room for anything other than actions that will deliver maximum returns.

"The company needs to focus on creating cash flow," the managing partner of an investment fund tells GamesIndustry.biz (they have asked to remain anonymous). "Debt disciplines the company to focus on return on capital much more. Debt is actually a pretty good and healthy driver and enforcer of shareholder value, good capital stewardship, and a company's stewardship. Ultimately, a company's sole purpose to exist is to create shareholder value."

Nick Button-Brown

For games industry angel investor Nick Button-Brown, himself a veteran of Electronic Arts, the level of debt on the company's balance sheet going forward is concerning. He argues that EA has "always invested its profits" and that the dividends it pays to shareholders are relatively small compared to the money it brings in.

"If you look at FIFA and FC Sports, that is an amazing game each year," Button-Brown says. "The infrastructure that they built around it, the mechanics, the gameplay, all of that has been done because, year after year, they've invested the profits from the last one into the next one.

"The problem with a leveraged buyout is that from that point on, those profits don't get reinvested back into the games. They exit to service financing elsewhere. The level of that leverage means a lot of interest each year. It's cash that's just sucked out of the business that can't be reinvested back into making the next generation of products. That level of leverage changes EA's flexibility in how much they can put into their existing IPs."

"Those profits don't get reinvested back into the games. They exit to service financing elsewhere"<br>Nick Button-Brown

The concern for Button-Brown is that Electronic Arts will have less cash to back new iterations in its blockbuster series. "That lack of investment will have an impact on their future games. You won't feel it next year, but you will feel it in five years."

However, our anonymous investment managing partner says that this can be a good thing and argues that "most companies tend to over-invest" in projects.

"If you are not forced to be capital efficient, you will overinvest because capital is plentiful," they say. "The debt can force you to be more disciplined; there's an equilibrium where you don't overinvest and gold-plate things, but you invest enough for the game to be still a good experience. I'd be surprised if the deal really changes the quality of the games."

Monetisation

One concern among some consumers is that the leveraged buyout will force Electronic Arts to be more...