Electronic Arts has attracted about $25 billion in investor demand for a debt sale of nearly $15 billion tied to its planned buyout, putting the financing at the center of the current leveraged credit market.
The order book covers loans and bond tranches that banks are marketing as part of the $55 billion take-private transaction. The sale comes as underwriters try to place large acquisition debt packages during a period marked by wider credit spreads and higher market volatility.
The financing package includes a roughly $4 billion US dollar term loan B and a €1.531 billion euro term loan, equal to about $1.75 billion. Investors have placed about $9 billion of orders for the leveraged loan portion alone.
The term loan B is being marketed at 98.5 cents on the dollar with pricing of 350 to 375 basis points over benchmark rates. The package also includes a $3.25 billion term loan A that banks usually retain on their balance sheets.
Demand has also grown across the bond side of the financing. Orders for a $4.75 billion secured bond have reached about $9 billion, while a $2.5 billion unsecured bond has attracted about $7 billion of demand. The secured notes are expected to include both US dollar and euro-denominated debt. Deal terms may still change before final pricing, including the currency split and final structure of the tranches.
Taken together, the marketed financing includes institutional loans, secured notes, unsecured bonds, and bank-held debt. The bond portion totals about $9 billion, while the loan package adds another $5.75 billion across dollar and euro markets.
These figures place the Electronic Arts sale among the largest buyout-related debt offerings now in syndication. Investor commitments for the cross-border loan are due by March 23, and the acquisition is expected to close in June.
The debt sale is reaching investors at a time when banks are also trying to offload other acquisition-related loans and bonds. Recent market volatility has complicated that process. Higher oil prices and geopolitical tensions have pushed risk premiums higher, while fund flows into lower-rated credit have weakened. Those shifts have made pricing and demand central to current buyout financings.
Even with those pressures, orders for the Electronic Arts financing have risen from more than $19 billion earlier in the marketing process to about $25 billion. JPMorgan is leading the bank group arranging the financing.
The debt supports a consortium-backed acquisition of the video-game publisher. The buyers include Silver Lake, Saudi Arabia’s Public Investment Fund, and Affinity Partners. JPMorgan had committed a record $20 billion to support the buyout financing.
At present, the debt structure includes about $4 billion in US dollar term loan B debt, about €1.531 billion in euro loan debt, $4.75 billion in secured bonds, $2.5 billion in unsecured bonds, and a $3.25 billion term loan A.
The full package totals nearly $15 billion. Demand above the offered amount gives underwriters more room as they finalize allocations and pricing. The final structure may still shift before launch, but the current figures show broad participation across the different parts of the financing package.