Over three dozen United States (US) lawmakers want the Federal Trade Commission (FTC) to dive deeper into the pending sale of Electronic Arts (EA).
In a press release recently shared online, the leaders of the Labor Caucus along with over 40 members of US Congress are asking FTC chair Andrew Ferguson to take another look at the sale. In the letter, the Labor Caucus chairs say they have “serious concerns” regarding the sale of EA to the Saudi Arabia Public Investment Fund (PIF).
“We are committed to preserving fair, competitive labor markets and safeguarding American jobs, and given the impact of this acquisition on workers, labor market concentration, and the long-term competitiveness of the U.S. video game industry, we urge you to thoroughly review this transaction,” the letter reads.
“Workers in the video game industry are already navigating an environment marked by instability, shrinking opportunities, and repeated rounds of layoffs. EA is one of the largest employers of video game workers in the United States, and evidence suggests the company already wields significant wage-setting power.”
Congress Worried EA Sale Could Lead To More Layoffs
The lawmakers add that with the deal including $20 billion in debt being added to EA after the sale, the new owners would be incentivized to hold more layoffs in order to recoup money. They also express worry that more offshoring, restructuring, and studio closures could come after the closing of the deal.
“These actions would not only jeopardize thousands of high-skilled American jobs, but also further concentrate already fragile labor
markets for software engineers, artists, writers, testers, and other professionals whose skills are essential to the industry,” they said.
The Labor Caucus chairs say that FTC’s 2023 merger guidelines explicitly state that any mergers that harm workers or allow firms to reduce labor demand “may violate antitrust laws”. Due to the size of the deal—$55 billion—the group feels that extra scrutiny is essential to protecting the rights of American workers that are involved.
They are asking the FTC to “conduct a thorough investigation into the labor market consequences of this proposed acquisition, including EA’s existing wage-setting power, the likelihood of post-transaction layoffs, the degree of labor-market concentration in relevant geographic and occupational markets, and the role of cross-ownership in shaping labor outcomes.”
What do you make of US lawmakers requesting further investigation into the sale of EA to the Saudi Arabia PIF? Leave your thoughts down in the comments below, and join the discussion in the official Insider Gaming Discord.
For more Insider Gaming, check out the latest episode of the Developer Spotlight with Carmageddon: Rogue Shift Director Giuseppe Franchi. And for even more Insider Gaming delivered directly to your inbox, sign up for our weekly newsletter.
Mike has been covering the gaming industry since 2012, and has reported on some of the largest events in the industry while also working as an investigative reporter. Outside of…
More from Mike Straw
My opinion is simple: countries (not just the US, all of them) should ban companies in their country being sold to foreign state owned companies.
If that was the case most gaming now would not exist look at Tencent and what they own. Europe and Canada especially needs foriegn money and Japan now too using American, Chinese, and Korean money to fund things
Yeah bro too late the Chinese own a ton now not just gaming but tech, land, farming, music, news, and Hollywood. The Saudi’s want to compete. Even before that Canada was buying American companies too like Popeyes and Burger King are owned by Canada now somehow and DiC the animation company among others from the US got bought by Canada weirdly enough they do not want to sell back. It gets even more complicated with music involving Japan and France buying things up. Sony is a key example too they did not create Colombia Pictures or the western gaming studios. Spotify is partially owned by Tencent.
They never complain when it’s China which worse buys US land and farming companies including farmland? Just saying only a issue now not for China which 1 party simps for and deflects when it contradicts their so called values.
This really is no issue it is a gaming company not a big deal in terms of hurting people in a large way gaming is a luxury not a necessity. Why don’t they call out venture capital firms robbing people? Or not waste taxpayer money on corporate bailouts and wars. Elizabeth Warren who is pushing this has openly stated to protect Black Rock and other firms like it spending and wasting 401k’s. This is all about a certain party losing control. Companies like Microsoft need to pull donations from the democrats these people tried to block the ABK deal and will try to cause trouble with other acquisitions which are coming. The same people crying about this are also the same ones who demanded Disney buy 20th Century millennial adult children.