According to a new report from Reuters, Unity Software may be the latest company set to be bought up in part by Saudi Arabia, and yet another in the recent wave of buyouts, mergers and closures across the games industry. The developer of the Unity engine has supposedly been in discussions with U.S. private equity firm Silver Lake Partners and Saudi Arabia’s sovereign wealth fund, the PIF, which only just concluded its purchase of EA earlier this summer. The goal is for a full buyout, which would further increase the scope of the Saudi Arabian government’s investments within the games industry.
Currently, Unity is a publicly-traded company with eight percent ownership by Silver Lake. The latter has now partnered with PIF to lead a consortium of investors in discussions for a buyout of the technology company. Notably, these two businesses also worked together alongside President Donald Trump’s son-in-law Jared Kushner’s Affinity Partners on the buyout of EA and Niantic, although details about of other partners involved in this latest deal are not yet known.
Discussions are still taking place with no firm agreement at this time. However, according to Reuters, the offer by the group places the company at a valuation of $25 billion, above their current public price of $21.5 billion. This would make this one of the largest buyouts to have occurred in the history of the games industry, with only Activision’s purchase by Microsoft and EA’s sale ahead of it.
PIF Puff
The deal would have a major influence on the games industry if it goes ahead: Unity is the second-most popular games engine used by developers, behind Unreal Engine, and the engine has uses beyond gaming, used in sectors such as engineering and filmmaking.
The move would further increase Saudi influence on game development: alongside EA, the PIF owns mobile game developer Scopely, and also own stakes in Nintendo, Capcom and Take-Two Interactive. It’s an expansion of soft power influence using gaming as a vehicle as the country seeks to diversity beyond oil, with the government making extensive efforts to associate itself with the games industry through ownership of Evo and their own eSports World Cup.
Any buyout of Unity Software would also introduce notable uncertainty into the future of the games industry, due to the reliance of many developers for the technology—especially as some developers express uncertainty regarding Epic Games’ current AI-focused direction with Unreal Engine.
