Rumor: This report has NOT been officially confirmed by Unity, Silver Lake, or the Public Investment Fund.
Following the $55 billion deal involving Electronic Arts, another major name in the gaming industry could soon change hands: According to a Reuters report, Unity has reportedly held acquisition talks with financial investor Silver Lake and the Saudi Arabian sovereign wealth fund PIF. These two investors are among the buyers of EA.
What Reuters reports about the discussions
Reports indicate that an investor consortium valued Unity at approximately $25 billion. The discussions reportedly took place before Unity released its latest quarterly figures. Afterward, the market value was around $21.5 billion, according to the source, and the stock reportedly rose by about 4 percent in after-hours trading.
Following the inquiry, Unity is said to be working with an investment bank to explore its options. Reuters quotes: “No deal is certain, and the plan and terms may still change.” Unity declined to comment, while Silver Lake and PIF did not immediately respond to the news agency's request.
How realistic is an acquisition of Unity by Silver Lake and PIF?
The report does not seem entirely unfounded. Silver Lake is already involved: The investor holds about 8 percent of Unity, according to GamesIndustry.biz. They first invested $400 million in May 2017, when the company was valued at $2.6 billion. In 2019, Silver Lake was also one of four investors who participated in a purchase offer for shares from former shareholders totaling up to $525 million, at which point the valuation stood at $6 billion. After the IPO in 2020, it climbed to $13.7 billion.
For us, this remains a rumor with a credible source, nothing more. An inquiry, a valuation on the table, and an engaged bank are far from a signed contract. The addendum from Reuters itself shows how quickly such plans can change.
Unity reports first profit
The timing is interesting: Unity recently reported its first profitable quarter under US GAAP accounting, with a 32 percent increase in revenue to $622 million. In the summer quarter, revenue was $546 million, a 24 percent increase. On a non-GAAP basis, Unity had already reported a profit for the first time in 2023. A company that is just achieving profitability naturally becomes more attractive to financial investors.
Those who play games will not notice anything for now. The Unity engine and services are embedded in many titles, but concrete consequences for developers or players cannot be inferred from the report. The fact that major industry acquisitions are occupying the scene is also shown by our report on the bidders for Arkane studio. We will keep you informed as soon as any party makes an official statement.
Source: GamesIndustry.biz, Reuters
Would a Unity owned by Silver Lake and PIF concern you, or do you see it as fresh capital for the engine?
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