Support for ailing video game retailer
U.K retailer GAME Digital have announced this morning that 26% of their stock has been sold to sportswear retailer Sports Direct.
The sale comes in the wake of GAME posted its third profit warning last month, resulting in a 36% drop in share value. GAME claiming short supply of Nintendo Switch consoles and a “weaker line-up of new games” as contributor to the huge loss. The long-time retail chain has struggled hard ever since it went into administration in 2012, costing the company over 270 of its stores.
Sports Direct, helmed by tycoon Mike Ashley, has bought 44m shares in GAME, giving the buyers a 25.75% stake in the retailer. This adds GAME to Ashley’s portfolio, which also contains shares in Debenhams, Findel, Agent Provocateur and French Connection. Ashley is also the owner of football team Newcastle United.
For you outta-towners, Sports Direct is a popular U.K high-street outlet, which sells sportswear and training shoes at low cost out of its 470 stores. The company has fought serious allegations against its warehouse working conditions ever since an undercover investigation, led by UK newspaper The Guardian, in 2015.
A spokesperson for GAME has stated: “The group looks forward to working collaboratively with Sports Direct to explore the clear opportunities that a constructive partnership and collaboration can deliver for all stakeholders in the gaming, live events and rapidly growing esports markets in which it operates.”
Sports Direct buys 26% Stake in GAME [Sky News]
