Silver Lake Partners, a U.S. private equity firm, and Saudi Arabia’s Public Investment Fund have reportedly made an offer to buy Unity Software. The bid would value the company at about $25 billion.
Reuters, citing unnamed sources, reports that Unity is seriously considering the offer and has hired an investment bank as an adviser. The offer was reportedly made several weeks before the company released its third-quarter earnings.
The report showed a 59% year-over-year increase in strategic revenue and a 134% rise in adjusted EBITDA. After it came out, Unity’s stock gained about 4%, and the company’s market capitalization reached approximately $21.5 billion.
Now the question is whether the offer will change. The bidders may raise it to match Unity’s higher value, or they may have seen this growth coming and priced it in from the start. Unity, for its part, hasn’t decided. As of November 6, Reuters said, nothing had been signed, and none of the companies would confirm or deny the story.
Silver Lake has been circling Unity for a long time. It first stepped in during 2017, joining a $400 million round that valued the company at $2.6 billion. Two years later, it came back for more, helping buy up to $525 million in shares from common shareholders when Unity was worth $6 billion. Today, those bets add up to a stake of 8% to 9%.
Unity isn’t Silver Lake’s only video game holding. In August, a consortium of Silver Lake, PIF, and Jared Kushner’s Affinity Partners closed a $55 billion leveraged buyout of Electronic Arts, one of the industry’s most contentious deals in recent years.
The new owners cut costs and closed BioWare, the studio behind Mass Effect, Baldur’s Gate, Neverwinter Nights, Knights of the Old Republic and Jade Empire. The next Mass Effect game, informally Mass Effect 5, ended with it.
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