Saudi Arabia’s Public Investment Fund has moved closer to completing its $55 billion acquisition of Electronic Arts after the European Commission approved the transaction under EU merger rules.
The regulator concluded on July 23 that the acquisition would not create competition concerns. One European review remains. The Commission is examining the transaction under its Foreign Subsidies Regulation, with a decision due by July 30. Reuters reported that the PIF-led consortium is expected to secure approval, citing people familiar with the process, although no formal subsidy decision had been announced as of July 27.
EU Antitrust Approval Clears One Hurdle
PIF leads the investor consortium, with private-equity group Silver Lake and Affinity Partners participating. The group agreed in September 2025 to acquire Electronic Arts in what Reuters described as the largest leveraged buyout on record.
The antitrust decision addressed whether the takeover could reduce competition in the European gaming market. Because PIF and its partners do not operate a competing global video-game publisher of EA’s scale, the Commission found limited competitive overlap.
Why the Foreign-Subsidy Review Is Different
The Foreign Subsidies Regulation allows the European Commission to investigate whether financial support from a government outside the EU gives an acquirer an unfair advantage. The regulator can approve a transaction, require commitments or begin a deeper investigation when it identifies possible distortions.
That framework has placed state-backed Gulf investors under closer examination when pursuing large European-linked acquisitions. A clean decision on July 30 would remove one of the most closely watched regulatory questions surrounding the EA takeover.
Inside the $55 Billion Electronic Arts Buyout
EA shareholders are set to receive $210 in cash for each share, representing a 24.8% premium to the company’s unaffected closing price of $168.32 on September 25, 2025. PIF already owned 9.9% of EA and agreed to roll that stake into the privately held company.
The financing combines about $36.4 billion of committed equity with $20 billion of debt. EA’s regulatory filing says the debt package includes term loans, bridge facilities and a revolving credit line. Completion is not subject to a financing condition, meaning the buyers cannot abandon the agreement simply because financing becomes more expensive or difficult to obtain.
Sources: Electronic Arts filings, European Commission and Reuters.
EA shares traded at $209.06 on July 27, leaving a gap of $0.94 to the offer price. The implied merger spread was about 0.45%, suggesting that public-market investors assign a high probability to completion while retaining a small allowance for regulatory and closing risk.
EA’s Cash Flow Supports the Deal, but Raises the Execution Bar
Electronic Arts enters the takeover with stronger bookings and cash generation than it reported when the agreement was announced.
Fiscal 2026 net bookings reached a record $8.03 billion, up 9% year over year. Revenue rose 1% to $7.53 billion, while operating cash flow increased 23% to $2.55 billion. Live services and other revenue accounted for about 71% of the annual total, giving the business a large base of recurring digital spending.
The $55 billion enterprise value equals approximately 7.3 times fiscal 2026 revenue and 6.9 times net bookings, based on Nukoud calculations. Committed debt is equivalent to about 7.8 times annual operating cash flow, although that comparison is a measure of scale rather than a formal leverage ratio.
Large franchises such as EA Sports FC and Battlefield give the buyers established intellectual property, recurring engagement and global distribution. The financing structure also means that steady cash generation will matter after EA becomes private, particularly if borrowing costs remain elevated.
Why the EA Deal Matters for Saudi Arabia
The acquisition fits Saudi Arabia’s effort to develop gaming as a domestic industry and a source of non-oil economic activity.
PIF already owns Savvy Games Group, which completed its $4.9 billion purchase of mobile-game developer Scopely in 2023. EA would add a larger international publisher with established development teams and global sports-gaming rights.
Saudi Arabia’s National Gaming and Esports Strategy targets the creation of 250 gaming companies and 39,000 jobs by 2030. It also aims to raise the industry’s contribution to gross domestic product to SAR50 billion.
The economic effect will depend on what follows the acquisition. Ownership of an overseas publisher does not automatically create domestic production capacity. Saudi Arabia would gain more from the transaction if it leads to development studios, skilled employment, publishing operations and intellectual-property investment inside the Kingdom.
What the Deal Means for Gaming ETFs
A completed takeover would also change the holdings of gaming-focused exchange-traded funds.
Electronic Arts represented 6.61% of the VanEck Video Gaming and eSports ETF, ticker ESPO, as of July 23, making it the fund’s third-largest position behind NetEase and Tencent. Once EA becomes a private company, it would no longer qualify for the underlying listed-equity index, requiring ESPO to redeploy the position during an index adjustment.
The effect would be smaller for broad technology and Nasdaq-linked ETFs because EA carries a much lower weight in diversified portfolios. Gaming funds, however, would lose one of the sector’s largest listed publishers and gain greater relative exposure to companies including Nintendo, Take-Two Interactive and Roblox.
What Happens After the July 30 Decision
Approval under the Foreign Subsidies Regulation would move the transaction closer to completion, although other closing conditions may remain.
The merger agreement sets September 28, 2026, as the initial outside date. That deadline can automatically extend to December 28 when specified regulatory approvals remain outstanding and the other closing conditions have been met or can be satisfied.
For PIF, the July 30 decision is the immediate test of whether Europe’s newer subsidy rules will slow a record state-backed takeover. For EA shareholders, the narrow merger spread shows that the market expects the deal to close. The longer-term measure will be whether a $55 billion acquisition builds production and gaming employment in Saudi Arabia while generating enough cash to support one of the largest debt packages ever attached to a media transaction.
