A union in Canada is calling for a thorough examination of the acquisition of a major video game company by entities linked to Saudi Arabia’s sovereign wealth fund and a private equity firm connected to Jared Kushner, son-in-law of U.S. President Donald Trump. The Communications Workers of America Canada is urging the federal government to scrutinize the potential takeover of Electronic Arts Inc., citing concerns about national security and employment impact.
The consortium of buyers, which includes the Public Investment Fund, Affinity Partners led by Kushner, and Silver Lake, is looking to purchase Electronic Arts Inc., a prominent American company that has had a presence in Canada for several decades. EA has established five offices in the country, contributing significantly to the success of its popular sports games and playing a vital role in Canada’s thriving $5.1-billion video game industry.
CWA Canada expressed apprehension that the sale of EA could jeopardize the industry, especially following recent layoffs at EA’s competitor Ubisoft and the acquisition of Activision Blizzard by Microsoft, causing uncertainty among industry players. The union emphasized that the entry of a company of EA’s magnitude could lead to stifled competition, potential job losses, and industry restructuring.
While EA did not respond to CWA Canada’s concerns, the company assured its staff in a previous communication that there would be no immediate changes to their roles following the acquisition. The Saudi sovereign fund and the private equity firms involved in the deal also did not provide comments on the matter.
The union has reached out to Industry Minister Mélanie Joly and the Competition Bureau, requesting a review of the transaction under the Investment Canada Act and Competition Act to safeguard national interests. CWA Canada highlighted the potential risks associated with the deal, including the integration of EA with a foreign state, concerns about data privacy and security, and the impact on Canadian jobs.
The Competition Bureau’s review of the merger concluded with an outcome listed as “other,” indicating a unique circumstance that does not fit standard resolution options. The bureau’s spokesperson stated that confidentiality restrictions prevent disclosing further details about the review process.
CWA Canada raised concerns about the possibility of EA expanding in Saudi Arabia while downsizing operations in Canada due to the substantial debt financing the acquisition. The union fears that layoffs and cost-cutting measures may be employed to service the debt, potentially altering the industry landscape and affecting the creative process in game development.