Electronic Arts (EA), the publisher behind The Sims, Apex Legends and Madden, was acquired just over a month ago by a private equity consortium comprising Saudi Arabia’s Public Investment Fund (PIF), Silver Lake Partners and Affinity Partners, the firm owned by Jared Kushner.
Now, a new report says PIF executives are considering combining EA with Savvy Games Group, the PIF-owned gaming company that controls businesses including Scopely, the developer behind Pokémon Go.
Bloomberg’s report says the proposed structure would place the world’s largest publisher inside Savvy to “ensure better coordination between its assets”. No final decision has been made, and the plan may remain on hold until Savvy completes its proposed $6 billion acquisition of Chinese mobile-game business Moontown.
Why merge EA with Savvy?
A merger would give the Saudi wealth fund one central organisation for acquisitions and game development instead of several subsidiaries working separately. That could make it easier to direct investment across a growing international games portfolio.
However, bringing the companies together would probably attract significant legal scrutiny. The size and market reach of the combined operation could prompt antitrust inquiries, similar to those surrounding Microsoft’s acquisition of Activision Blizzard.
Uncertainty for EA staff
Reports from within EA indicate that developers and other frontline employees are being kept in the dark about what the ownership changes mean. There is also concern that studios across the group could face substantial layoffs.
The possible merger is another reminder that ownership decisions at major publishers can affect the wider games business, from development teams to the long-term future of established franchises. RETROCADE readers can follow more arcade and gaming industry news, or explore the practical side of the hobby with our arcade machine buying guide and range of arcade machines.
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