What BioWare's Closure Means for the Games You Love

For players, studio closures like BioWare's mean cancelled projects and lost jobs—and the private equity playbook suggests more beloved teams could face the same fate.

For players, studio closures like BioWare's mean cancelled projects and lost jobs—and the private equity playbook suggests more beloved teams could face the same fate.

Key points - BioWare, developer of Mass Effect and Dragon Age, has closed, with 400 layoffs across EA. - BioWare's new owners were Saudi Arabia and Jared Kushner, per the source. - Leveraged buyouts use debt collateralized by the acquired company's own assets. - EA's buyout involved a $20 billion loan from JP Morgan. - In 2024, private equity-backed companies made up over 10% of corporate bankruptcies.

Timeline - 2024: A report using S&P data finds private equity-backed companies accounted for over 10% of corporate bankruptcies. - 2018: Toys 'R' Us, cited as a cautionary private equity case, announced bankruptcy. - 2017: Toys 'R' Us bankruptcy is highlighted as a top-of-mind example by Kiplinger's Karee Venema. - Recent: BioWare closes and 400 layoffs hit EA, with a leaked Mass Effect trailer pointing to a cancelled game.

FAQ

Q: Why did BioWare close? A: Per the source, BioWare struggled to turn development mayhem into sales success, and its games weren't suited to loot boxes—factors unlikely to appeal to its new owners.

Q: What is a leveraged buyout? A: A company is bought with a mix of borrowed money and private equity, with the purchased company's balance sheet used as collateral—and repayment becoming its responsibility.

Q: Does private equity always destroy companies? A: No. The source notes successes like Hilton and Dell, but gaming has seen repeated cases of private equity causing carnage.