"Videogame giant Electronic Arts will be taken private in a record-breaking $55 billion (roughly Rs. 4,87,899 crore) leveraged buyout by a consortium consisting of private equity firm Silver Lake, Saudi Arabia's Public Investment Fund and Jared Kushner's Affinity Partners, the company said Monday. The deal for the maker of Battlefield underscores how deep-pocketed investors are betting on the enduring value of blockbuster game franchises as the industry recovers from a prolonged downturn."
"It would be the largest leveraged buyout on record, eclipsing TXU Energy's 2007 takeover and other landmark transactions of that decade, including Toys "R" Us and Hertz, and comes amid a rebound in global dealmaking as easing borrowing costs revive appetite for mega-transactions. Under the deal, EA shareholders will receive $210 per share in cash, representing a premium of 25 percent as of the closing price on September 25 before reports of a deal emerged."
""While the $210 per share offer price may appear compelling ... we believe it falls materially short of the company's intrinsic value. With Battlefield 6 about to launch and a pipeline that could add more than $2B in incremental bookings by FY28, the true earnings power of EA is only beginning to emerge," Benchmark analysts said."
A consortium led by Silver Lake, Saudi Arabia's Public Investment Fund and Jared Kushner's Affinity Partners will take Electronic Arts private in a $55 billion leveraged buyout. The transaction carries an equity value near $52.54 billion and offers EA shareholders $210 per share in cash, a roughly 25 percent premium to the September 25 closing price. The deal would be the largest leveraged buyout on record and reflects renewed appetite for mega-deals as borrowing costs ease. EA plans to rely on its sports franchises and the upcoming Battlefield 6 to drive future bookings, while some analysts contend the offer may understate the company’s intrinsic earnings power.
Read at Gadgets 360
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