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With Electronic Arts now nearly absolutely owned by Saudi Arabia’s Public Investment Fund, a Bloomberg report says the wealth fund is now giving thought to merging it with the PIF’s different gaming crown jewel, Savvy Games Group.
No choices have been made at this level, in response to the report, which additionally says that any potential merger would doubtless wait till the completion of the PIF’s acquisition of Chinese cellular gaming firm Moonton for $6 billion, a deal that was announced in March. The proposed merger would even have to beat numerous regulatory hurdles.
From the angle of the PIF, and by extension Saudi Arabia—the fund’s chairman is Mohammed bin Salman, the de facto ruler of the nation—a merger would appear to make sense. Savvy Games Group is a behemoth in its personal proper, with subsidiaries together with esports org ESL Faceit Group, Pokémon Go publisher Scopely, and—soon—Moonton. Bringing that and EA’s own significant operations under one umbrella would presumably simplify the PIF’s gaming strategy going forward.
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The PIF may also be motivated to make a merger by the fact that money, even for the ever-flush Saudi kingdom, is getting a bit tight. Mergers typically result in the elimination of duplicated operations and services, and their related expenses. As we’ve seen many times in the past, that means layoffs: EA employees are already bracing for deep cuts as the company moves to take on the $18 billion debt load incurred as a result of the PIF’s acquisition of the company earlier this year, and it’s not unreasonable to think that the new Saudi owners would be looking for other ways to pare back costs.
How a proposed merger would fare under regulatory scrutiny is less clear. The resulting company would be a global powerhouse, effectively under the control of a single person—a person who’s been credibly accused of ordering the murder and dismemberment of journalist Jamal Khashoggi in 2018, do not forget.
That would possibly appear to be the type of factor that is destined to run into roadblocks, however bin Salman can also be shut with present US president Donald Trump, whereas the PIF’s acquisition of EA within the first place was facilitated partly by Trump’s son-in-law Jared Kushner. Those connections could have helped the PIF keep away from the aggressive (and in the end futile) actions confronted by Microsoft when it acquired Activision Blizzard, they usually could show helpful once more sooner or later too.
Electronic Arts declined to touch upon the report. I’ve additionally reached out to the Public Investment Fund and Savvy Games Group for remark, and can replace if I obtain a reply.
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