Arkane Austin only made Redfall since Prey, the rest were Arkane Lyon (which didn't close). Allegedly (based on some articles) Redfall started as a pure singleplayer game ala Prey 2017 (and their older titles) but Zenimax and Bethesda wanted to add multiplayer and Games-as-a-service elements because they thought it'd increase the company's value back when they were looking for buyers
Essentially the studio was forced to make a game very different from what they were known for (not just as Arkane but even people who worked there) and wanted to make for reasons outside the game's own merits, which in turn introduced a lot of production issues (they did not have the staff or know-how and had to expand in size) and predictably ended up a mess.
This seems bizarre to me. They're closing the one that made Prey 2017. Is it because labor is cheaper in France vs in Austin, USA? Or maybe because everybody who was involved with making Prey left during the shitshow that was Redfall? Or a combination maybe? I can't imagine giving Harvey Smith the axe, though I guess he'll be one of the handful who'll be shuffled off to work on something else inside Bethesda.
Not only it’s probably cheaper in France, but France has strong employee-protection laws, so closing a company there will probably be more costly on severances alone, assuming they can justify to the government why they are closing that company.