Silver Lake and Saudi Arabia's PIF, the pair who bought EA, have reportedly held talks to buy Unity at around US$25 billion. Nothing's signed, but if you make or play games built on Unity, pay attention.
Reuters reports Silver Lake and Saudi Arabia's PIF have held talks to buy Unity at a valuation of around US$25 billion.
Unity's market cap is about US$21.5 billion. Nothing is signed and the deal could still fall over.
It's the same pair that bought EA for about US$55 billion, a deal that closed in August.
Unity is the second most popular game engine, used for games like Hollow Knight, Cult of the Lamb and Dredge.
The company is only a year past cancelling its hated Runtime Fee, and just posted its first GAAP profit since 2020.
Saudi Arabia already owns EA. Now it reportedly wants the engine a massive chunk of the games industry is built on. Reuters reported on Thursday (NZ time) that Silver Lake and Saudi Arabia’s Public Investment Fund (PIF) have held talks in recent weeks about buying Unity Technologies, the company behind the Unity engine, at a valuation of around US$25 billion.
Same two buyers as the EA deal. Same playbook. And if you make games in Unity, or play anything built on it, this one’s worth paying attention to.
Kotaku’s headline calls it “$21.5 billion buyout talks”, but read the fine print: US$21.5 billion is what the market says Unity is worth. The number on the table is about US$25 billion.
If this happens, it’d be one of the biggest buyouts in gaming history, behind only Microsoft’s Activision Blizzard deal and the EA sale. That EA deal, worth about US$55 billion, was put together by the same Silver Lake and PIF pair alongside Jared Kushner’s Affinity Partners, and closed in August.
That’s on top of everything else the PIF already has. It owns mobile giant Scopely, which bought Niantic’s games business including Pokemon Go. It owns fighting game tournament Evo, bankrolls the Esports World Cup, and holds stakes in Nintendo, Capcom and Take-Two, the publisher of the GTA 6 you’re about to play. The PIF is chaired by Saudi Crown Prince Mohammed bin Salman.
Buying a publisher gets you games. Buying Unity gets you the toolbox thousands of other studios use to make theirs. It’s the second most popular game engine behind Unreal, and it’s everywhere on mobile and in indie games. Closer to home, Melbourne’s Massive Monster made Cult of the Lamb in Unity, Adelaide’s Team Cherry built Hollow Knight and Silksong on it, and Wellington’s Black Salt Games made Dredge with it.
Unity is also coming off a rough few years. In September 2023 it announced the Runtime Fee, a per-install charge on games made with the engine, and developers lost their minds. The backlash was so bad the company cancelled the fee outright a year later and went back to seat-based pricing, with Pro going up 8% to US$2,200 a seat. It has only just turned the corner: its latest quarter brought in US$622.1 million, up 32% on last year, and its first GAAP profit since it floated in 2020, mostly thanks to its AI ad platform, Vector.
The timing is spicy, too. The same week this report dropped, Epic’s Tim Sweeney was defending a big AI push in Unreal Engine 6, which is spooking some developers. The obvious alternative to Unreal now has a question mark of its own over who’ll own it.
Let’s not pretend this is about loving game engines. Private equity buyouts usually come with debt, and debt has to get paid back. EA’s deal leaned on about US$20 billion of borrowed money, and since it closed EA has shut down BioWare and cancelled the next Mass Effect. Now picture that same pressure on the company that sets the price of the tools thousands of indie devs rely on. Unity already showed us in 2023 what it does when it wants more money out of developers. A private owner doesn’t have to answer to shareholders or put up with a public backlash.
And yes, the other bit matters. A sovereign wealth fund run by the Saudi state would own a growing share of how games get made, published, played and competed in, not just a few studios. You can be relaxed about that, but you shouldn’t be oblivious to it.
It’s not done yet. No deal is signed, Unity isn’t talking, and these things fall over all the time. But Silver Lake already has a seat at the table, literally, and the last time this pair started talking to a gaming company, it ended with a US$55 billion cheque.
Making something in Unity, or just worried about where this is heading? Come and argue about it in the GetRekt Discord.
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