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One way or another, GAME as we know it has GONE, and may be replaced by something entirely different on Monday.
MCV has learnt today that GAME management has presented suppliers with four possible outcomes for the company. The conclusion follows a period of consultation between a hired financial specialist and GAME’s key suppliers.
The first option is a refinancing of the current company, as would be the desire of current bidders OpCapita. However, this conclusion has been ruled out entirely, MCV can reveal.
The second option is what is being described as a White Knight investor. With a deadline of Sunday looming, this option is now incredibly unlikely.
The third option is our worst fear – GAME enters administration and is closed down on Monday. This option remains on the table and cannot be ruled out without a pledge of commitment from suppliers..
However, a fourth option has now emerged that could safeguard a large proportion of the chain’s UK workforce.
THE NEW PLAN
MCV understands that the current route being pursued by GAME is a voluntary entry into administration which will likely be finalised before the weekend.
This would be followed by the opening of a brand new company, funded by current bank lenders, from the ashes of the chain we know as GAME. This is scheduled to occur on Monday. The GAME Group (GMG) would be removed from the Stock Exchange.
This would include only GAME’s UK and Spanish chains – all other international operations would effectively be cut off and told to fend for themselves”.
GAME’s current store portfolio will be reassessed and a store closure programme implemented. MCV understands that this will likely mean the end for Gamestation, with the exception of a handful of well-performing stores.
The details of this plan were outlined to suppliers today in the hope that they will back the new-look, streamlined operation.
"If everyone commits it’s great news,” MCV was told by a source close to the negotiations. A GAME with 300+ stores is what we’ll all get, which is basically where they should have been three years ago during the peak. There’s no need for two, or even three, stores in the same town or city.
"They get a chance to reduce debt, keep trading and work out a plan for a new owner without so many financial and lease millstones around their necks."
All eyes now turn to the industry’s key publishers and suppliers. GAME’s future, quite literally, now lies in their hands.
UPDATE: GAME has contacted MCV to stress two points. One, that a supplier meeting did not take place this afternoon. Indeed, having spoken again with our sources it seems that these meeting have been ongoing since last Friday.
Secondly, GAME wants to make it clear that it challenges many of the claims in this article”, although it would not be drawn on specifically which claims it is referring to.
