Elliott Advisors, a US hedge fund specialist, has amassed a 99 per cent stake in Game Retail.
The Financial Times reports that the move comes ahead of GAME’s expected flotation and could land the company a significant windfall, although the paper adds that a final decision on whether or not to go for an IPO has yet to be made.
The FT adds that “Elliott was the sole and unpublicised backer of OpCapita, the private investment firm run by Henry Jackson that orchestrated the [GAME] buyout, and has loaned the business more than £100m.”
Elliott currently bankrolls GAME’s £106m credit facility, which operates at 7.5 percentage points above Barclays’ base rate.
Its stake in Game Retail actually evens out around 90 per cent once management stock options are factored in and it is understood that it wants to retain a stake of between 50-70 per cent in the long term.
Elliott was founded by Paul Singer in 1977.
The hedge fund also has a significant stake in Morrisons, which suffered a terrible festive trading period. It has in the past enjoyed successes with clients such as TWI, WorldCom and Enron.