Monday, 19 March 2012

GAME stores finally bite the dust

GAME will die this week without £180m rescue

Unless GAME can get £180 million before the end of this week, it looks like the mighty gaming retailer giant will fall, with bills of £21 million rent payment due on Sunday, more than £10 million owed in deferred VAT, £40 million owed to video game suppliers and a £12 million wage bill shortly requiring payment. On top of that there is the debt to the banks GAME is indebted to, Royal Bank of Scotland is reportedly owed $45m, and Barclays, HSBC and La Caixa are all thought to be owed around £30m each.

Apparently the retail chain rejected a 'rescue bid' from Opcapita. The GAME Group was "teetering on the brink of collapse on Friday" after the retailer's lenders - who are owed more than £100 million - rejected a rescue deal proposed by private equity firm OpCapita.

It has also set in motion the process of closing a number of its UK stores. It has sent letters to customers living in affected areas to inform them of its plans, which are part of a previously announced strategy to reduce its UK store portfolio from 610 to 575 outlets. According to Eurogamer, the troubled firm is reassuring customers that existing pre-orders will be transferred to alternative GAME or Gamestation stores.

GAME is informing individual customers of its plans rather than announcing a list of stores facing closure, but reports indicate outlets in Bracknell, Berkshire, Hull and Wrexham are among those set to close.

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