From NASDAQ to Nondisclosure: The Financial & Legal Shockwaves of EA’s USD 55 Billion Privatisation on Esports

EA is set to exit NASDAQ. At the end of September 2025, Electronic Arts (“EA”) announced that they have reached an agreement with an investment consortium to be acquired through a Leveraged Buyout (“LBO”) for an approximate record-breaking value of USD 55 billion, all-cash.¹ The consortium is made up of the Public Investment Fund (PIF) of Saudi Arabia, Silver Lake, and Jared-Kushner-founded Affinity Partners. 

EA is one of the largest and most important gaming and esports companies in the world, with titles such as Battlefield, the FC series (formerly known as “FIFA”), the Madden NFL series, and more industry-leading games. Such a large-scale deal with an industry giant like EA could have important ramifications for the gaming and esports industry, and this article discusses what the future, post-deal, may entail.

Public v Private Companies

First, we need to establish what it means for a public company to go private. The distinction can vary by jurisdiction, but for the sake of the discussion, we will approach it through a rather surface-level analysis. 

Private companies are owned by the company’s founders, or, as will now be the case with EA, by a group of private investors. The shares of the company cannot be sold to the public and are traded only amongst a small group of individuals. A company may wish to be private as it allows the owners more control over the decision-making of the company, a higher percentage of the profits, and less regulatory scrutiny and requirements, as will be explained later on. 

Public companies, on the other hand, are traded on the stock exchange, meaning their shares are open to the public and thus the shareholders can be made up of a large number of (dispersed) individuals. The shareholders are given numerous crucial rights, such as suing the company for wrongful acts, inspecting corporate documents, and vote on important matters.²

Many jurisdictions like the UK and EU (not US) also require a minimum share capital for public companies i.e. a minimum monetary value that a company must have in its balance sheet before it can begin offering shares to the public. This means that not all companies can actually go public.

Some companies prefer to be publicly traded as it provides a good avenue to raise capital through selling shares to the public, and it is often associated with a better reputation, due to the higher regulatory requirements that they must meet.³ However, in return, such companies ‘suffer’ higher public scrutiny and regulatory compliance obligations. Furthermore, selling shares to the public means the shareholders and existing management could lose control of the company if an investor purchases a controlling stake.⁴

EA used to be a public company with shares owned by the general public, traded on NASDAQ, one of the United States’ most important stock exchanges. EA’s shares were valued at around USD 193 per share right before the announcement of the deal.⁵ One of EA’s shareholders was none other than PIF, who owned approximately 10% of the company’s shares, and will now own the vast majority of it following the buyout.

The PIF has been active in the esports industry in general, organising events such as the Esports World Cup.⁶ The deal concluded will see the consortium purchasing all of EA’s public shares, for a value of around USD 210 per share (nearly USD 20 over the market value of the shares), taking EA private, meaning the shares will no longer be publicly traded but will be held by the consortium itself. The deal was financed through an LBO, a financial transaction where an investor borrows large amounts of money in order to acquire a company. 

Possible Consequences

There are several possible positive consequences that could come about from a public company going private. Due to a public company having a large number of potentially dispersed shareholders, companies could find it difficult to make efficient and quick decisions, as certain significant choices have to pass through an Annual General Meeting (“AGM”) and require a certain threshold (e.g. 75% in the UK) of votes for the decision to pass.⁷ 

Additionally, large companies often face activist shareholders who use their voice to lobby for a specific cause,⁸ so the decision-making process can be hindered by conflicting shareholder interests. Hence, going private could simplify the decision-making process, allowing for quicker decisions and less conflicting agendas and views as the only ones making decisions are the consortium itself. Moreover, public companies face more regulatory scrutiny regarding aspects like transparency and reporting, which could take time and attention away from directors and managers.⁹ Going private could eliminate these ‘burdens’ and allow the company to focus purely on generating long-term profits. 

Nevertheless, for a large company such as EA, with outstanding importance in the gaming and esports industries, going private could have several negative implications:

Firstly, as mentioned, the acquisition of EA was financed through an LBO, which required a significant monetary loan by the Consortium, who hopes to be able to pay it back through the profits and cash flow of the acquired company. The deal reportedly resulted in the consortium taking on USD 20 bln of debt which they need to pay back.¹⁰ 

What this potentially means is that the new owners of EA will feel significant pressure to generate short-term profit, under pressure to repay their debt. In order to do so, consumers of EA’s games could face an upsetting increase in aggressive monetisation, such as microtransactions, which EA was already heavily criticised for in the past.¹¹ Knowing the revenue-generating potential that microtransactions have, especially with EA’s ‘successful’ utilisation of them in the past (in 2023 EA reported USD 4.3 billion in revenue from microtransactions,¹² EA’s fanbase should be expecting a surge in microtransactions following the acquisition. 

Secondly, a particular worry related to the large debt incurred by the consortium with the LBO is EA’s ability to invest in new games. Generally, when firms incur a lot of debt they naturally have less cash flow free to invest in innovation and research and development, as explained by the European Central Bank, writing: 

“…strained balance sheets could significantly depress firms’ investment in the coming years with negative implications for innovation and growth”.¹³

This clear obstacle to innovation is particularly problematic with the case of EA, as consumers’ “…most common complaint is that EA fails to innovate”.¹⁴ For a company that already has a negative reputation with regards to innovation, the gaming industry and users could see even more ‘lazy’¹⁵ mechanics and gameplay out of EA’s future games, as the consortium works to repay its debt. 

A related third potential negative consequence which follows the LBO and the debt incurred is loss of jobs. Following the announcement of the deal, the United Videogame Workers-CWA union has released a statement heavily criticising the acquisition, predominantly regarding the risk it holds towards EA’s employees. This concern comes given that the gaming industry has already seen thousands of layoffs occurring recently, even in seemingly profitable companies.¹⁶ 

The union, in its statement, communicated this concern explicitly: “If jobs are lost or studios are closed due to this deal, that would be a choice, not a necessity, made to pad investors’ pockets—not to strengthen the company…”.¹⁷ If the union’s concerns come to fruition, this could have devastating consequences on the esports and gaming industry, as layoffs are becoming more normalised and talented professionals who can help develop and innovate the industry could be let go for the chance at extra profits. 

A fourth potential negative consequence that naturally comes with companies going private is less transparency and reporting i.e. nondisclosure. Public companies that are traded on the stock exchange, as mentioned above, are subject to strict regulatory and compliance obligations, especially regarding reporting and transparency. 

For example, as a public company, EA had to publish quarterly and annual reports on topics such as sales, future expectations, etc.¹⁸ Private companies are not subject to the same scrutiny, and are not obliged to report on any information to the general public. This could prove problematic in the esports industry, as it would be difficult to get a sense of how EA is faring with regards to debt, revenues, what are their future expectations and plans they have, etc.

This not only leaves consumers in the dark, but also stifles competitive scrutiny, leaving EA’s competitors in the dark, which could consequently reduce their own motivation to innovate, not being driven by the potential large profits (or debts) of their competitor.

In the same vein, being private means the public no longer has any say in the company’s decisions through shareholder meetings. This means that EA is less likely to take into account the concerns of the public and are more likely to prioritise their own profits at the expense of other important aspects such as Corporate Social Responsibility.¹⁹ 

A last potential negative consequence worth noting that has been heavily debated in the last few years and even more so with the news of this transaction is concerns over the stronghold forming by Saudi Arabia over the esports industry. The country already acquired stake at other industry leaders such as Nintendo and Take-Two Interactive, as well as purchasing Niantic’s (the makers of Pokemon Go) gaming division.²⁰ 

Some are concerned with this development in the esports industry, as they associate Saudi Arabia with potential human rights violations.²¹ For example, in an Amazon Prime documentary covering the Esports World Cup, a portion of the Saudi version of the film was cut where a member of the Team Liquid Franchise recalled his experiences growing up as a gay man in the US.²²

Moreover, some see the deal as nothing more than a political move for personal enrichment, noting a pattern with Jared Kushner and PIF’s investments (citing a USD 2 bln investment by the PIF secured by Kushner following Donald Trump’s first term), claiming the deal merely “weaponizes the gaming industry’s existing vulnerabilities”.²³

This acquisition could hurt the reputation of the esports industry and could even drive consumers away from it, for example the Sims franchise has one of the largest LGBTQ+ community of users of any game,²⁴ and they have already expressed their disapproval of the deal,²⁵ with one user on X commenting on the acquistion: “Huge step back for one of the most inclusive and proudly woke games [The Sims] that built its legacy on diversity and representation.. this is so out of character”.²⁶

Takeaways

There is still some time until the deal fully closes, but industry experts and gamers around the world are already looking for answers. Should they worry? What does the deal mean for their favorite games? Could the deal prove beneficial for the gaming industry? All these questions are too early to answer firmly, but there seems to be rather a lot of disapproval of the acquisition, due to, inter alia, the reasons stated above. 

I am of the opinion that it is in everyone’s best interest for EA to remain public, as it should be held to public scrutiny and focus on innovation, not debt repayment. It is difficult for me to envision a scenario where this large scale deal will prove a net positive to the gaming industry. Amongst the most common complaints about the gaming industry is the need for more ethics, diversity, and transparency,²⁷ yet the acquisition will seemingly worsen all three. Nevertheless, I hope I will be proven wrong, as the gaming and esports industry is currently hurting,²⁸ and could really use a knight in shining armor. 

EA Going Private: The Leveraged Buyout Shift (Image generated by Google Gemini)

1. CNBC, ‘EA shareholders will get $210 per share in deal to take company private’ (CNBC, 29 September 2025) https://www.cnbc.com/2025/09/29/ea-shareholders-will-get-210-per-share-in-deal-to-take-company-private.html accessed 3 November 2025. 
   ↩︎
2. DFIN Solutions, ‘Public vs Private Company’ (DFIN Solutions) https://www.dfinsolutions.com/knowledge-hub/thought-leadership/knowledge-resources/public-vs-private-company accessed 3 November 2025. ↩︎
3. ibid ↩︎
4. ibid ↩︎
5. CNBC (n 1). ↩︎
6. Faisal AlSarraj, ‘Beyond the arena: Saudi Arabia’s economic potential of Gaming and Esports’ (PwC Middle East, 28 January 2025) https://www.pwc.com/m1/en/media-centre/articles/saudi-arabia-economic-potential-in-the-gaming-and-esports.html accessed 4 November 2025.
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7. Thomas Sutherland, ‘What Are the Requirements of an Annual General Meeting?’ (LegalVision UK, 27 July 2024) https://legalvision.co.uk/corporations/annual-general-meeting/ accessed 3 November 2025. ↩︎
8. James Chen, ‘What Is an Activist Shareholder? What They Do and How They Work’ (Investopedia, updated 30 June 2022) https://www.investopedia.com/terms/s/shareholderactivist.asp accessed 3 November 2025.
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9. Marvin Dumont, ‘Why Public Companies Go Private’ (Investopedia, updated 30 March 2025) https://www.investopedia.com/articles/stocks/08/public-companies-privatize-go-private.asp accessed 3 November 2025.
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10. BBC News, ‘Gaming giant Electronic Arts bought in unprecedented $55bn deal’ (BBC News, 29 September 2025) https://www.bbc.co.uk/news/articles/cn4w3jzx807o accessed 4 November 2025.
    ↩︎
11. Asif Zapata, ‘From play to pay: How microtransactions took over gaming’ (The Business Standard, 4 October 2023) https://www.tbsnews.net/features/play-pay-how-microtransactions-took-over-gaming-712234 accessed 4 November 2025.
    ↩︎
12. ibid ↩︎
13. Rodrigo Barrela, Paloma Lopez-Garcia and Ralph Setzer, ‘How high corporate debt stifles investment’ (ECB Blog, 18 January 2023) https://www.ecb.europa.eu/press/blog/date/2023/html/ecb.blog230118~0eb37005b7.en.html accessed 4 November 2025.
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14. Mark Hill, ’15 Years Ago, EA Learned the Wrong Lesson From Its Boldest Flop’ (Inverse, updated 20 February 2024) https://www.inverse.com/gaming/mirrors-edge-15-year-anniversary accessed 4 November 2025.
    ↩︎
15. ibid ↩︎
16.  Andy Chalk, ‘Saudi Arabia’s acquisition of Electronic Arts faces pushback from game developers, petition calls on FTC to “scrutinize this deal closely”‘ (PC Gamer, 16 October 2025) https://www.pcgamer.com/gaming-industry/saudi-arabias-acquisition-of-electronic-arts-faces-pushback-from-game-developers-petition-calls-on-ftc-to-scrutinize-this-deal-closely/ accessed 3 November 2025.
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17. ibid ↩︎
18. Electronic Arts, ‘Electronic Arts Reports Q1 & FY26 Results’ (Press Release, 29 July 2025) https://www.ea.com/news/electronic-arts-reports-q1-fy26-results accessed 4 November 2025.
    ↩︎
19. Wuchun Chi, Shing-Jen Wu and Zhen Zheng, ‘Determinants and consequences of voluntary corporate social responsibility disclosure: Evidence from private firms’ (2020) 52(6) The British Accounting Review 100939.
    ↩︎
20.  BBC News (n 6).
    ↩︎
21.  BBC News (n 6).
    ↩︎
22. The Observer, ‘Saudi takeover of gaming industry leaves little room for dissent’ (The Observer, 13 July 2025) http://observer.co.uk/news/business/article/saudi-takeover-of-gaming-industry-leaves-little-room-for-dissent accessed 3 November 2025.
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23. Daniel Stone, ‘Private Equity’s EA Takeover: Corruption, Contradictions, and Exploitation’ (CEPR, 9 October 2025) https://cepr.net/publications/electronic-arts-and-private-equity/ accessed 4 November 2025.
    ↩︎
24.  Keza MacDonald, ‘Why the enormous Saudi-led deal to acquire EA matters, whether you play games or not’ (The Guardian, 1 October 2025) https://www.theguardian.com/games/2025/oct/01/pushing-buttons-ea-electronic-arts-saudi-arabia accessed 4 November 2025.
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25. Charlie Duncan, ‘The Sims LGBT content Saudi Arabia EA’ (PinkNews, 1 October 2025) https://www.thepinknews.com/2025/10/01/the-sims-lgbt-content-saudi-arabia-ea/ accessed 3 November 2025. ↩︎
26. ibid ↩︎
27. Ali Hussain, ‘How the Video Game Industry Is Changing’ (Investopedia, updated 26 April 2025) https://www.investopedia.com/articles/investing/053115/how-video-game-industry-changing.asp accessed 4 November 2025.
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28. Richie Knows, ‘Is the Gaming Industry Broken?’ (Medium, 19 February 2025) https://medium.com/@richmelcombe/is-the-gaming-industry-broken-931f3d938653 accessed 4 November 2025. ↩︎