Home / Business and Economy / Goldman Sachs Earns Record $110M Fee in $55B EA Buyout
Goldman Sachs Earns Record $110M Fee in $55B EA Buyout
11 Nov
Summary
- Goldman Sachs to earn $110M for advising on EA's $55B take-private deal
- Consortium led by Saudi PIF, Silver Lake, and Kushner's Affinity Partners
- Largest leveraged buyout in history
In a landmark transaction, Goldman Sachs is poised to earn a staggering $110 million fee for advising Electronic Arts (EA) on its $55 billion take-private deal. This makes it the most lucrative M&A transaction in the investment bank's history.
The deal was struck in September, with a consortium comprising Saudi Arabia's Public Investment Fund (PIF), private equity group Silver Lake, and Jared Kushner's investment firm Affinity Partners agreeing to acquire the video game giant. The transaction ranks as the biggest leveraged buyout of all time.
The massive payout to Goldman Sachs comes amid a surge of large corporate deals across the United States, fueled by favorable debt markets, lighter competition oversight, and executives' confidence in the strength of the economy. Other notable advisory fees include Bank of America's $130 million for Union Pacific's $85 billion takeover of Norfolk Southern, and JPMorgan Chase's $123 million for AbbVie's $63 billion acquisition of Allergan.
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According to a securities filing, Goldman received $10 million when the EA deal was announced, with the remaining $100 million due upon the transaction's completion, which is subject to shareholder and regulatory approval. The investment bank had not earned any advisory or underwriting fees from EA in the previous two years, but had generated substantial fees from working with PIF and Silver Lake.
