Silver Lake, Saudi Foreign Wealth Fund held talks to buy Unity game engine

Silver Lake and Saudi Arabia’s Public Investment Fund have recently discussed acquiring Unity Software, the maker of a widely used game-development engine, according to people familiar with the talks. The consortium considered a valuation of about $25 billion before Unity reported stronger-than-expected quarterly results, which raised its market value to roughly $21.5 billion. Unity has hired an investment bank to assess its options, but no agreement has been reached and the terms could change. Silver Lake already owns about 8% of Unity, invested as much as $400 million in the company in 2017, and has a representative on its board.

The potential purchase would extend the investors’ involvement in gaming after they helped take Electronic Arts private in a $55 billion transaction completed in August. Unity’s tools power games including Monopoly Go! and Pokémon Go, while its real-time 3D technology is also used in fields such as automotive design, film, architecture and industrial simulation. The company has expanded from its core game engine into advertising and other software. Its third-quarter revenue rose 32% to $622.1 million, with growth in advertising and game-development businesses; its AI-powered Vector advertising platform helped it record its first quarterly GAAP profit since its 2020 public listing.