PIF to own 93% of US videogame developer EA

Saudi Arabia’s Public Investment Fund (PIF) is reportedly set to take a 93.4 percent stake in US videogame developer Electronic Arts (EA).

In September, a consortium comprising PIF, private equity company Silver Lake and Affinity Partners, an asset management company headed by Jared Kushner, agreed to buy the California-based company for $55 billion.

The group had not previously disclosed how the ownership would be divided.

A November filing with Brazil’s antitrust regulator showed that the PIF would hold 93.4 percent of EA, with Silver Lake taking 5.5 percent and Affinity Partners 1.1 percent, the Wall Street Journal reported.

PIF will roll over its existing holding in EA, a 9.9 percent stake, valued at $5.2 billion at the agreed takeover price, the newspaper said. This suggests the sovereign wealth fund will have to inject $29 billion in new cash to reach its final ownership stake.

The all-cash transaction will be financed through a $36 billion equity investment by the consortium and $20 billion in debt financing.

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PIF slashed its investments in listed US companies during the third quarter, suggesting the kingdom’s strategists sought to take profits from a prolonged market rally and may be less confident about the prospects for US stocks.

In January Crown Prince Mohammed bin Salman pledged to invest another $600 billion in the US over President Donald Trump’s second term in office.

Yet it seems equities are unlikely to be part of the additional spending, despite the Crown Prince’s visit to Washington in November.