Silver Lake and PIF discuss Unity acquisition at $25 bn valuation

Private equity firm Silver Lake Partners and Saudi Arabia’s Public Investment Fund (PIF) have reportedly held discussions about acquiring gaming software developer Unity, just months after participating in the $55 bn takeover of Electronic Arts.

According to Reuters, citing people familiar with the confidential discussions, the investors approached Unity in recent weeks and considered a potential transaction valuing the company at approximately $25 bn.

• Silver Lake and Saudi Arabia’s Public Investment Fund have reportedly approached Unity about a potential acquisition, with a valuation of approximately $25 bn discussed.
• Silver Lake already owns around 8% of Unity and previously partnered with PIF and Affinity Partners in the $55 bn acquisition of Electronic Arts.
• Unity reported its first GAAP-profitable quarter since going public, with third-quarter revenue rising 32% to $622 mn.

Unity has reportedly engaged an investment bank to assess its options following the approach.

The valuation was discussed before Unity released its latest quarterly financial results, which helped lift its market capitalisation to around $21.5 bn.

However, the discussions remain preliminary, and there is no guarantee that an agreement will be reached. The proposed structure and financial terms could also change.

Unity declined to comment on the reports, while Silver Lake and PIF did not immediately respond to requests for comment.

Unity shares rise following acquisition reports and earnings

Unity shares experienced significant gains following the release of its third-quarter financial results and reports of potential takeover interest. The company’s stock rose approximately 14.9% during regular trading on Thursday, closing at $48.80 per share.

Shares increased further in extended trading after Reuters reported the acquisition discussions, rising approximately 4% initially. The market reaction followed stronger-than-expected quarterly earnings.

Unity reported third-quarter revenue of $622 mn, representing a 32% increase from approximately $471 mn in the same period of 2025.

The company also recorded net income of $122 mn under Generally Accepted Accounting Principles (GAAP), compared with a net loss of $127 mn a year earlier. This marked Unity’s first GAAP-profitable quarter since its initial public offering in September 2020.

Adjusted earnings reached $0.44 per share, while adjusted EBITDA totalled approximately $257 mn.

The improved performance was supported by growth in Unity’s advertising technology business, particularly its AI-powered Vector advertising platform.

Unity’s Grow Solutions segment generated $457 mn in revenue, an increase of 44% year on year. Create Solutions, which includes the company’s game development products, contributed $165 mn, up 8%.

The third-quarter results extended a period of improving performance following a strong second quarter, when revenue increased 24% to $546 mn.

Silver Lake already owns 8% of Unity

Silver Lake has maintained a relationship with Unity for nearly a decade and remains one of its largest shareholders. The investment firm owns approximately 8% of Unity’s outstanding shares.

Its initial involvement dates to May 2017, when it announced an investment of up to $400 mn in the company. Unity was valued at approximately $2.6 bn at the time.

Former Unity chief executive John Riccitiello described the investment as providing additional financial security while the company pursued opportunities in virtual reality and augmented reality.

Silver Lake subsequently participated in another financing transaction in 2019.

Alongside D1 Capital Partners, Canada Pension Plan Investment Board, Light Street Capital and Sequoia Capital, it supported a tender offer allowing existing Unity shareholders to sell up to $525 mn of stock. That transaction valued Unity at approximately $6 bn.

In September 2020, Unity completed its initial public offering, raising approximately $1.3 bn through share sales and reaching a valuation of around $13.7 bn.

The company had not achieved GAAP profitability at the time of its listing.

Unity subsequently reported its first profitable quarter on a non-GAAP basis in 2023, before recording its first quarterly GAAP net profit in 2026.

Silver Lake’s Egon Durban also serves on Unity’s board of directors, creating an additional governance consideration should formal acquisition negotiations proceed.

Silver Lake and PIF completed $55 bn Electronic Arts acquisition

The potential Unity transaction would represent another major investment in the gaming industry for Silver Lake and PIF.

The two investors were part of the consortium that completed the $55 bn acquisition of Electronic Arts in August 2026. The transaction also involved Affinity Partners, the investment firm founded by Jared Kushner.

Under the ownership structure reported for that acquisition, PIF holds approximately 93.4% of EA, Silver Lake owns 5.5%, and Affinity Partners accounts for the remaining 1.1%.

The acquisition took Electronic Arts private, removing the publisher from public stock markets. EA is responsible for major gaming franchises including EA Sports FC, Battlefield and The Sims.

Since the takeover, the company has implemented corporate restructuring measures, including workforce reductions and studio closures.

In October, Electronic Arts announced the closure of BioWare, the studio behind Dragon Age and Mass Effect. The publisher also cancelled development of the next Mass Effect project.

The potential acquisition of Unity would extend Silver Lake and PIF’s exposure beyond game publishing and development into the technology infrastructure used to create and distribute games.

There has been no confirmation that Affinity Partners, which participated in the EA transaction, is involved in the reported Unity discussions.

Unity’s game engine supports major gaming franchises

Founded in Denmark in 2004 and now headquartered in San Francisco, Unity develops a cross-platform game engine and software tools used to create interactive digital experiences.

Its technology supports development across mobile devices, personal computers, gaming consoles and extended reality platforms.

Unity’s engine is particularly prominent in mobile gaming and independent development, where its cross-platform capabilities allow developers to distribute games across multiple operating systems.

The company competes with Epic Games’ Unreal Engine, which has a substantial presence in high-budget game development. Unity’s technology is also used by major mobile game businesses, including Scopely.

Scopely acquired Niantic’s games division in May 2025, bringing Pokémon Go, Pikmin Bloom and Monster Hunter Now into its portfolio.

The Scopely ownership structure includes investment interests linked to the same group of investors involved in the Electronic Arts acquisition.

Unity expands beyond gaming into AI and industrial software

Since its public listing in 2020, Unity has diversified beyond its original game engine business.

The company has expanded its advertising technology operations and developed software for creating interactive real-time 3D content outside traditional gaming.

Its tools are increasingly used in automotive design, architecture, filmmaking and industrial simulation.

Unity has also increased its focus on artificial intelligence, including tools intended to simplify game creation and automate development tasks.

The company’s advertising operations have benefited from AI-driven technologies that support user acquisition and advertising performance.

However, Unity has also experienced challenges in recent years. In 2023, the company faced substantial criticism from developers after proposing a runtime fee linked to game installations.

The controversy contributed to the departure of former chief executive John Riccitiello and prompted changes to Unity’s pricing strategy.

More recently, improving revenue growth and profitability have supported a recovery in investor sentiment.

Potential Unity acquisition remains uncertain

A completed acquisition would place one of the gaming industry’s largest software infrastructure providers under private ownership.

Such a transaction would follow the Electronic Arts takeover and further expand the investment exposure of Silver Lake and Saudi Arabia’s PIF to the global gaming market.

However, the reported $25 bn valuation remains preliminary and should not be treated as an agreed purchase price.

Unity’s improved financial performance and rising share price may also influence negotiations.

For now, the company is evaluating its options, and neither Silver Lake nor PIF has publicly confirmed a formal acquisition agreement. Any potential transaction would depend on further negotiations, agreed financing and applicable regulatory approvals.