JPMorgan Chase (JPM.US) Adjusts Debt Structure for Electronic Arts (EA.US) Acquisition Deal; Dollar Loan Size Increased to $5 Billion

Bloomberg News has learned that Wall Street banks, led by JPMorgan Chase (JPM.US), recently revised the debt financing plan related to the acquisition of video game developer Electronic Arts (EA.US), increasing the issuance size of the U.S. dollar loans to $5 billion.

According to sources familiar with the matter, the syndicate increased the loan amount by $1 billion and simultaneously reduced other dollar-denominated secured debt by the same amount, bringing it down to $3.75 billion.

In the current environment where banks are dealing with turbulent markets and selling high-risk bonds related to acquisitions, they are attracting a broader range of investors through various credit markets, including leveraged loans and high-yield bonds, with some financing involving different currencies.

Last year, JPMorgan pledged to provide a record $20 billion in financing for the EA acquisition, drawing significant attention on Wall Street. Previously, due to a sluggish loan market, the bank shifted part of the debt financing for this deal to high-yield bonds. As of last Friday, EA had attracted approximately $25 billion in subscriptions for about $15 billion in loans and bonds.

On Monday, U.S. President Donald Trump announced that after productive talks to end hostilities, he would delay strikes on Iran’s energy facilities, boosting credit markets. However, the market remains fragile amid concerns over AI disruption and ongoing Middle East tensions.

In recent other leveraged financing adjustments related to mergers and acquisitions, Nexstar Media Group Inc. (NXST.US) revised its debt financing plan for the acquisition of peer television station owner Tegna Inc. Led by Bank of America (BAC.US), the syndicate increased the bond issuance proportion in the total $6.9 billion debt plan and cut the leveraged loan portion by $1 billion last Friday.

The acquirers of EA include private equity firm Silver Lake Partners, the Public Investment Fund of Saudi Arabia, and a consortium managed by Jared Kushner, President Trump’s son-in-law, called Affinity Partners. The deal values the video game company at approximately $55 billion.