Game administration puts 160 jobs at risk
Video games retailer Game, which employs 160 people in Northern Ireland, has gone into administration.
Professional services firm PwC has been appointed administrator to the UK operations of the business, which has 609 stores under the names Game and Gamestation.
The chain, which employs 385 staff at its headquarters in Basingstoke, Hampshire, and around 5,100 in its stores, has suffered dire trading in recent months, while some suppliers refused to stock the retailer as its worsening finances came under increased scrutiny.
PwC said it was hopeful that Game could be sold. The group's lenders were reportedly working on plans to buy a slimmed-down version of the retailer out of administration, meaning the company could still potentially shed thousands of jobs.
A consortium of existing banks led by state-backed Royal Bank of Scotland is understood to be among three potential bidders, along with American rival Gamestop and OpCapita, which recently acquired consumer electronics business Comet.
Mike Jervis, joint administrator and partner at PwC, said: "The group has faced serious cashflow and profit issues over the recent past. It also has suffered from high fixed costs, an ambitious international roll-out and fluctuating working capital requirements.
"Despite these challenges, we believe that there is room for a specialist game retailer in the territories in which it operates, including its biggest one - the UK. As a result we are hopeful that a going-concern sale of the business is achievable."
Game last week said it planned to appoint an administrator, having admitted there was no value left in the company. The chain's demise follows a string of profit warnings and the failure of nervous suppliers, including Electronic Arts and Nintendo, to go on providing new games.
The retailer had a £21 million rent bill due on Sunday and faces a £12 million wage bill this weekend, although PwC is expected to honour any wages owed. There is also £10 million in VAT and £40 million owed to suppliers.
Game suffered a dismal Christmas and was later forced to ask suppliers for more generous trading terms. But many stopped supplying it with new releases, such as Mass Effect 3 and Street Fighter X Tekken, leaving fans disappointed and adding to the group's trading woes.