The GAME Group PLC, who operate both GAME and Gamestation, owns around 1300 commercial properties, could enter administration if a buyer is not found.
The group’s problems started last week when suppliers to the company’s commercial properties started to refuse to do business with them. In a statement, the company said: “We currently have a supply issue with regards to Mass Effect 3, which means that GAME and Gamestation will not be able to fulfil orders for Mass Effect 3 at this time.
“The Group confirms that it remains in discussions with its suppliers and lenders in relation to terms of trade that allow the business to operate within the facility. While these discussions are ongoing, it has not been possible to source new products from a number of suppliers.”
However, the likelihood of GAME and Gamestation commercial properties remaining on our UK High Streets is still uncertain, as the company is currently struggling with plummeting share prices. Share prices fell to just £1.29, a drop of 63 per cent, since the news broke about supplier issues.
In a statement, GAME Group was optimistic about share prices remaining steady, but unfortunately any efforts to encourage new shareholders to invest were in vain: “It is uncertain whether any of the solutions currently being explored by the Board will be successful or will result in any value being attributed to the shares of the Company.”
However, the group could be given a lifeline, as it has been rumoured that Walmart has shown interest in taking over the group. GAME Group hasn’t confirmed which companies who have entered into discussions about buying the company, but they did say that there has been preliminary dialogue between themselves and the potential investor.
“The Board of GAME confirm that a third party has shown interest in providing additional funding for the company. The third party is seeking a dialogue with the Group’s current lenders; however there is no certainty to the outcome.
“At the same time, the Board remains in its own discussions with its current lenders as it continues to conduct a review of its business and assets.”
Although the group has an online presence, they have still struggled with stiff online competition from the likes of Play.com and Amazon. Also, the weak Christmas sales did not help their recent predicament. Christmas is usually the busiest time of the year for retailers, but sales for the group fell by 12.9 per cent when compared to the same time in 2010.
Do you think, with the recent announcements that it is game over for GAME?
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