If you have an ear to the news of the last week, one of those has resonated in many general newspapers and media sites. EA has been bought by a conglomerate of partners offering $210 in cash per share, summing up a total of $55 billion. That’s a quick recap, but in the end, there is much more.
EA is one of the biggest game companies in the world. They operate money machine franchises such as Madden, FC (formerly FIFA), F1, NHL, etc. They have been in the business for more than 40 years, and they know exactly how to squeeze users’ wallets. So, they have always been an attractive company to invest in, provided you obtain the necessary regulatory permissions.
This time, have very interesting names involved that have made the deal and the procedures easier, like Silver Lake and Jared Kushner. The Saudi Public Investment Fund is one of the world’s largest sovereign wealth funds, and it has bought many companies in the last decade, trying to diversify Saudi Arabia’s investments.
F1
If we focus on racing gaming franchises, F1 seems to the one of the keys for the company. The new management has always been supporting the F1 category in the real world, so it is expected that somehow the future will be assured and bright for this title, even stretching more the contact between the current F1 parade and the virtual recreation.
Aramco is part of PIF, the main sponsor of the Aston Martin F1 team, and one of the biggest partners of Formula 1:
Aramco is a global integrated energy and chemicals company. We are driven by the core belief that energy is opportunity. From producing approximately one in every eight barrels of the world’s oil supply to developing new energy technologies, our global team is dedicated to creating impact in all that we do. We focus on making our resources more dependable, more sustainable and more useful. This helps promote stability and long-term growth around the world.
They are also the main sponsor of the Saudi Arabia GP in Jeddah.
WRC
In the rally part, we will see what happens with the WRC license, because apparently, Nacon had recovered the possibility to make an annual iteration from 2027 to 2032, but the money is treacherous, and any outcome could come from this new management. On the bright side, maybe we can expect a full Dakar title with Dirt Rally physics in the next years, because this race is part of the campaign of the Saudi government and has been previously funded and supported in titles like Dakar Desert Rally. It wouldn’t be a surprise if something similar shows up next year.
And for the employees, there is uncertainty, of course. The new management needs to repay $20 billion in debt, primarily to JP Morgan. And to service this debt, EA is expected to rely on its substantial revenue, but this may lead to layoffs, studio closures, and the selling of intellectual property (IP) or a greater focus on profitable areas like annual sports titles and live services.
There will be some action in the next months in the American company, there is no doubt about it.
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