EA reassures employees after acquisition, but analysts are under no illusions: company will sell its smaller brands to pay off debt

Yesterday, we wrote about concerns regarding the acquisition of Electronic Arts by a group of investment funds. As a result of this transaction, the publisher will be burdened with $20 billion in debt. To repay it, significant cost savings are planned, including the use of AI. Many employees fear that layoffs may follow. Providing an official FAQ is an attempt to allay these concerns.

The FAQ was made for internal use, but became public when it was included in the stock exchange filings. Among the questions included is: "Will private ownership lead to layoffs?" The response states:

It's worth noting the word "immediate" here, as it hints that layoffs might be on the agenda, just not right away.

Will EA sell some franchises and studios?

Analyst Serkan Toto from the Kantan Games group is convinced that layoffs are almost sure and will happen quite soon. David Cole from the research company DFC Intelligence has a slightly different opinion. He thinks there's a good chance EA might start selling off some smaller brands and internal studios to quickly pay down some of their debt. He points out that series like SimCity, Dragon Age, Plants vs Zombies, Bejeweled, or Command and Conquer aren't currently important for the publisher, and many other companies would be interested in acquiring them.

The Ultima series could be one of the IPs that EA might want to sell.

It's worth speculating a bit here. Recently, there have been speculations that Larian studio may be planning to develop a new installment in the Ultima series. If that's really the case, it's easy to imagine the creators of Baldur's Gate 3 trying to buy the series from EA so they can develop it as their own brand without any hassle.

Dragon Age: The Veilguard

October 31, 2024

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• EA / Electronic Arts
• layoffs / employments
• mergers and acquisitions
• acquisition of brand / license