CWA Labor Union, EA workers issue formal opposition to $55 billion Saudi buyout

The Communication Workers of America (CWA) labor union has issued a statement that opposes EA's proposed $55 billion sale.

2

EA is being taken private in a substantial $55 billion deal. A consortium is buying out EA's shares in the largest-ever leveraged buyout in tech history, consisting of Saudi Arabia's Public Investment Fund (PIF), Silver Lake, and Affinity Partners--the investment firm of US President Trump's son-in-law, Jared Kushner.

There's been pushback against the deal, as EA remains the largest US-based independent publisher that the video games industry has left, following Microsoft's $68.7 billion acquisition of Activision Blizzard. Labor union CWA has issued a statement on the buyout, expressing concerns that the deal will trigger mass layoffs, project cancellations, and significant labor disruptions--as major industry-shaking acquisitions, sales, and consolidations are wont to do. The EA buyout comes with $20 billion in "junk" debt, indicating unfavorably high interest rates against EA, which could trigger more layoffs and cost cutting. Then there's EA's potent generative AI on the other end of the worries.

• Read more: EA workers fight back: union slams $55 billion Saudi-backed buyout

"The recently proposed acquisition of Electronic Arts (EA) by the sovereign wealth fund of Saudi Arabia and private equity firms, including Jared Kushner's Affinity Partners, will further concentrate power and wealth into the hands of a few gatekeepers while doing nothing to address the concerns of players and workers.

"EA is not a struggling company. With annual revenues reaching $7.5 billion and $1 billion in profit each year, EA is one of the largest video game developers and publishers in the world.

"EA's success has been entirely driven by tens of thousands of EA workers whose creativity, skill, and innovation made EA worth buying in the first place. Yet we, the very people who will be jeopardized as a result of this deal, were not represented at all when this buyout was negotiated or discussed.

"We are particularly worried about the future of our studios that are arbitrarily deemed 'less profitable' but whose contributions to the video game industry define EA's reputation.

"Since 2022, an estimated 40,000 video game workers have already lost their jobs due to mass layoffs at AAA and indie studios alike. As reported in Game Developer, this deal will result in EA having to finance nearly $20 billion in debt-who will be spared, which corners will executives cut, and what studios will be sacrificed in order for that to happen?

"If jobs are lost or studios are closed due to this deal, that would be a choice, not a necessity, made to pad investors' pockets-not to strengthen the company.

"We are calling on regulators and elected officials to scrutinize this deal and ensure that any path forward protects jobs, preserves creative freedom, and keeps decision-making accountable to the workers who make EA successful."

Citigroup's Jason Bazinet says the deal is a "head scratcher" for the Saudis and other members of the consortium.

The deal is expected to close by April 2026, subject to regulatory approval.