Saudi Arabia's Public Investment Fund and private equity firm Silver Lake are in talks to acquire Unity for around $25 billion, according to Reuters. Silver Lake partner Egon Durban sits on Unity's board and the firm already owns eight percent of the company through a prior $400 million investment.
The $25 billion valuation came before Unity's latest quarterly report, which showed a 59 percent increase in strategic revenue year-over-year and net income of $122 million. That stronger performance could push the valuation higher. Reuters noted that Unity posted its first quarterly profit on a GAAP basis since going public in September 2020, driven partly by growth in its AI-powered Vector advertising platform.
The generative AI sector has faced headwinds this week following the US midterm elections, which could affect how companies relying on the technology are valued going forward.
PIF and Silver Lake previously acquired EA for $55 billion earlier this year. The EA deal was structured as a leveraged buyout, leaving EA with substantial debt. The report does not confirm the structure of the proposed Unity deal.
Unity faced public backlash in 2024 over a planned runtime fee that would have charged developers per game sale. The company reversed course on that policy. Unity also recently partnered with Google on AI game creation platforms called Google Playground and Unity Spark.