EA Declares 'No Immediate Changes' to Jobs in FAQ Following $55 Billion Buyout
Amid concerns voiced among employees regarding potential mass layoffs following its $55 billion buyout, EA has a new FAQ issued to its employees and filed at the U.S. Securities and Exchange Commission (SEC). It's intended to reassure staff especially in subsidiaries such as BioWare, where concerns are reportedly raising.
Job Assurance and Immediate Effect
Now, talking about job security given immediate effect, it is mentioned in the FAQ that there won't be any immediate changes in the workforce with the transaction.
"There will be no immediate changes to your job, team or daily work as a result of this transaction", reads the document. It emphasizes that these "world-class teams" will continue to be so because innovation is paramount to the company.
This declaration, however, makes no attempt to preclude future layoffs. The scenario can very easily be compared to other major tech and gaming company acquisitions like Microsoft's acquisition of Activision Blizzard. After that deal was done, layoffs occurred sometime later.
Competitive Edge for Going Private
Moreover, EA also discusses the strategic benefits associated with going from public to private. Through this move, the publisher intends to liberate itself from the quarterly public market expectations.
- Long-Term Investment: "Being a private company allows Electronic Arts to adopt a longer-term investment horizon, with greater latitude to pursue bold strategies," explained the FAQ.
- Greater Flexibility: This partnership is expected to lead to "increased creative and operational flexibility" to innovate and invest in major growth opportunities.
- Global Access: The deal positions the company as one that will "move faster and unlock new opportunities on a global stage."
Financial Position
FAQ states that "EA is in a strong financial position," but it would also be known that the consortium, which includes PIF, Silver Lake, and Affinity Partners, funded the buyout partly by incurring huge debt, which it is reported to be $20 billion.
