UK chain GAME entering administration

Failing UK-based video games chain GAME, which is roughly the equivalent of GameStop, today announced it will plans to enter administration as it tries to salvage this mess.

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Failing European video games store GAME Group, which is roughly the equivalent of GameStop, today suspended itself from the stock exchange and announced it plans to enter administration. The chain, which has around 6,000 jobs in the UK alone, has struggled for several years but recently hit rock-bottom, with suppliers refusing to supply new releases. Now, it'll enter administration in the hope of someone salvaging this mess.

GAME's profits have spiraled downwards for several years, but it hung on. In February, though, GAME Group confirmed that it was facing a big loss for the past year, and the situation was looking dire. It reportedly owes more than £100 million (over $158m) to banks, suppliers, and other creditors. It's also said to have a £21m ($33m) quarterly rent payment due on Sunday, and £12m ($19m) due in wages soon.

Capcom, Activision, Electronic Arts, Microsoft and other key publishers stopped supplying GAME over the past month as it couldn't pay them. When a high street store can't stock the big titles like Mass Effect 3 at launch, especially when it was supposed to be the only place selling the Collector's Edition, the end can't be far away.

GAME is based in the UK, where it has around 600 GAME and Gamestation stores, but also has another 700-odd scattered across Europe and Australia. A lot of people will be out of work if it goes down, and it's the UK's only nationwide chain dedicated to video games.

GAME's lenders are said to have turned down a deal from equity firm OpCapita, which recently turned around failing UK electronics chain Comet and had been hoping to grab GAME.

However, unconfirmed reports suggest a brand new company would be formed with backing from its bank lenders. Supposedly, this would open on Monday, shutting down many GAME stores and largely killing the Gamestation brand.

"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," an anonymous source reportedly close to the deal said. Of course, this is unconfirmed.

Whether GAME shuts down, staggers on, or is reborn, the best of luck to all those affected by this unpleasantness. For now, GAME and Gamestation stores are still open and trading, so you'd best get in there if you've got any gift cards saved.

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  • reply
    March 21, 2012 7:45 AM

    Alice O'Connor posted a new article, UK chain GAME entering administration.

    Failing UK-based video games chain GAME, which is roughly the equivalent of GameStop, today announced it will plans to enter administration as it tries to salvage this mess.

    • reply
      March 21, 2012 9:13 AM

      To be fair the person is correct saying there's no point having 2 stores in the same city. Where I live, there are 2 stores in the same shopping centre within 30 seconds walk from each other, and I know it's the same in other cities and towns, that just doesn't make sense.

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        March 21, 2012 9:20 AM

        [deleted]

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          March 21, 2012 9:37 AM

          I can't see that outweighing the saving of having one location and set of staff. I always went to the bigger local GAME shop on the street instead of the smaller one in a mall. *shrugs*

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        March 21, 2012 10:03 AM

        ebgames is the same around here there's two in the mall close to my house that are within 100 feet of eachother.

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          March 21, 2012 10:06 AM

          The mall near me had two also for a while but they closed one of them down. Originally one of the stores was a Babbage's which was bought out by ebgames (gamestop) and for some reason for a few years they kept both stores open.

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        March 21, 2012 10:22 AM

        to be fair, if it is a big city , then there is a case for more than one store in the city.. for eg London, or Manchester, which are fairly big and i wouldnt necessarily fancy travelling across the whole city just to get to the store.. i';d much rather use Amazon or Steam to purchase my game. i agree on your point thought. trafford centre mall in Manchester has two stores, which basically makes no sense.
        what has and is actually killing the retail market is the cost factor - their prices are higher than Amazon's. Steam has regular sales online and there are many times when i get a particular game for half price. even crappy games are usually sold at full retail price at some outlets when online stores sell for about a tenth of it.. maybe the new owners need to look at that aspect and encourage good price for trade ins and pre-owned sales price.

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        March 21, 2012 12:16 PM

        In Manchester we have 2 GAMEs 40 seconds from each other AND a Gamestation a minute away from that, and that's just in the arndale. Then there's the Trafford Centre GAMEs, the Stockport GAME etc., etc.

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      March 21, 2012 10:03 AM

      Here in the U.S. there are four Gamestop stores within 15 minutes of my house, and another 3 or 4 within 30 minutes.. I'm surprised Gamestop is doing so well while GAME is doing so poorly. Maybe it's more about how they run their business and less about the game industry.

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        March 21, 2012 10:20 AM

        I think GAME was especially badly hit by the internet here, both online shopping and digital distribution. I don't know a single person who bought from that place, it's all amazon / play / steam.

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