Electronic Arts set to go private in $55 billion deal — the latest in a long line of disappearing stocks
The “Madden” maker is set to join a growing group of listed companies that are deciding to drop out of exchanges.
This morning, video game maker Electronic Arts confirmed that it will be taken private by a consortium including Saudi Arabia’s wealth fund, along with private equity firms Silver Lake and Affinity Partners, in a deal that would value the company at some $55 billion, roughly 25% more than what the company was worth before deal rumors started circling last week.
The deal marks the largest take-private transaction in US history, topping the $45 billion buyout of Texas utility group TXU in 2007. That’s quite a record considering the rise of take-private deals more generally — a trend that’s exploded since 2012 in both count and volume. Per data from Bloomberg, last year saw a whopping 173 deals take stocks off the market, transactions worth some ~$289 billion and change.
Private party
Aided by a private markets capital pool that increasingly rivals its public cousin, the swelling dealmaking market is contributing to a broader trend: the slow decline of public markets.
Indeed, many high-profile startups like SpaceX and OpenAI have completely bypassed the hassle of public markets (like quarterly reporting, *cough*), finding no problem raising tens of billions of dollars for their cash-hungry operations.
The combined effect of fewer IPOs and a rise in take-private deals: there are now only half the number of public companies that were listed in the US in 1996, with just 4,010 public equities as of last year.
Related reading: Where did all the stocks go?
