A union in Canada is calling for federal examination of a purchase involving one of the largest video game producers globally by Saudi Arabia’s sovereign wealth fund and a private equity firm linked to the son-in-law of U.S. President Donald Trump. The Communications Workers of America Canada is urging the government to look into the acquisition due to concerns about national security and potential job losses if the consortium, which includes the Public Investment Fund, Affinity Partners led by Jared Kushner, and private equity firm Silver Lake, proceeds with buying Electronic Arts Inc.
The union expressed worry that the sale of Electronic Arts could have negative implications on the video game industry and coincide with recent industry challenges, such as layoffs at EA’s competitor Ubisoft and Microsoft’s acquisition of Activision Blizzard. CWA Canada’s president, Carmel Smyth, emphasized the impact the transaction could have on the industry as a whole, affecting numerous workers in Canada and the U.S.
EA, renowned for games like EA Sports FC, Madden NFL, and The Sims, is a key player in the global gaming market, generating substantial revenue. The union’s concerns about potential layoffs and market competition if the acquisition goes through were highlighted. EA did not respond to requests for comments on the union’s apprehensions.
Following the announcement of the $55 billion deal last year, which gained initial approval from EA’s board but requires further endorsement from shareholders and regulators, CWA Canada took proactive steps to address their concerns. The union reached out to Industry Minister Mélanie Joly and the Competition Bureau to request scrutiny under the Investment Canada Act and Competition Act.
The union raised worries about the potential integration of EA with a foreign entity and the security implications of sensitive personal data being accessed by the buyers. Concerns were also voiced about the lack of regulatory oversight in Saudi Arabia and the impact on data privacy.
While the Competition Bureau conducted a review of the merger, details of the outcome remain confidential. The bureau typically evaluates mergers to maintain competition in the market. The union’s letter to the bureau cautioned about the potential shift of operations from Canada to Saudi Arabia due to the deal’s financing structure and its debt implications.
CWA Canada expressed concerns about job losses, studio closures, and decreased creativity in game development if the acquisition proceeds as planned, emphasizing the potential negative consequences on the industry.
