The GAME Group: is there any hope left?
Things haven’t been looking good for the GAME group for a little while now, and as we charted in our feature
a week or two ago, signs continue to be that the end may well be nigh.
The pivotal moment? EA’s decision to not let GAME stock Mass Effect 3, presumably over fears that it wouldn’t get its money. EA refused to extend a credit line to the group, wanting money up front for Mass Effect 3, which GAME couldn’t afford to pay. As such, GAME couldn’t honour planned pre-orders of the title.
Sadly, since then, things have snowballed. It was announced earlier in the week that The GAME Group was up for sale, including the Gamestation stores by default. More worryingly, the cash is quickly running out. Trade magazine MCV has been close to the story
, and it’s reported that D-day for GAME appears to be 24th March. If it can’t find a buyer by that date, then the group is set to fall into administration.
It’s already clear that The GAME Group as we know it isn’t going to come out in the same shape. What’s increasingly possible, though, is that it’s not going to survive all of this at all.
The latest developments have seen more publishers refusing to let GAME stock their new titles. This time, it’s Capcom, SEGA, Microsoft and Activision amongst the firms concerned, with the games including Kinect Rush: A Disney/Pixar Adventure, Cabela Big Game Hunter 2012 (hardly a tragedy that one, but you get the point), Zhu Zhu Babies, Ninja Gaiden 3, FIFA Street and Resident Evil: Operation Raccoon City. That’s too many big titles to go unnoticed, and it’s accelerated the already tight timescale that the group is working against to get things sorted.
There is still the odd flicker of optimism though, not least from within the firm itself. A statement, released on Wednesday, was put out by The GAME Group. It read:
‘The Board of GAME confirm that a third party has shown interest in providing additional funding for the company. The third party is seeking a dialogue with the Group’s current lenders, however there is no certainty to the outcome. At the same time, the Board remains in its own discussions with its current lenders as it continues to conduct a review of its business and assets.
It is uncertain whether any of the solutions currently being explored by the Board will be successful or will result in any value being attributed to the shares of the Company.’
Gamestation and GAME: they may soon be no more...
Furthermore, it’s understood that there is interest in acquiring some of the firm’s stores. Names such as Walmart and Gamestop have been mentioned, although there’s nothing obviously conclusive as of yet. Comet owner, OpCapita, has also revealed its interest. It’s perfectly likely that any potential buyer will await administration, and go in and pick up whatever it can get for a potentially lower price. Inevitably, whether they do that or not, they’re not motivated by benevolence. Like the commenters on some Internet boards from gamers, they’re looking for a bargain resulting from any ensuing fire sale.
They aren’t the only ones looking to pick over the bones, either. MCV also broke the news that both Goldman Sachs and Blueshore Global have picked up shares in The GAME Group, which has led to the firm’s admittedly meagre share price slightly rising. Even though things are going to get worse before they get better, there’s clearly some belief that the assets of The GAME Group are worth fighting over.
The problem now, of course, is that GAME feels like a dead firm walking, and our thoughts are inevitably with the many employees, having to face the stark reality of wondering where their next pay packet is coming from. We know a number of them, and it’s a horrible time. It goes without saying that we hope they land on their feet, and quickly.
For The GAME Group, it’s eight days and counting to sort everything out. The decreasing support from its supplier base makes even its short-term future untenable, and the best case scenario would be that a buyer or investor is found in the next week, who can keep the bulk of the organisation in tact.
The practical advice for the next week for end users? Sadly, it would be to use up any GAME gift cards lying around, and also, where possible, to support the group. As we’ve discussed before, it’s been far from perfect, and most of us have a story about the highs and lows of some of the firm’s employees. But the high street was and is a better place with specialist gaming stores on it.
The absence of The GAME Group will leave a hole that – as digital distribution continues to grow – is likely to never be refilled.