GROUP’S lenders, led by The Royal Bank of Scotland, are working on plans that could result in them buying the crisis-hit video games retailer out of administration.
The company, which runs 1,274 stores worldwide and employs 10,000 workers – 6,000 of them in the UK – is expected to fall into administration as early as today, with the state-owned bank reported to be among the potential bidders.
Accountancy giant PwC has been lined up as administrator. RBS said last night it is still working with the retailer’s five other lenders including HSBC and Barclays on finding a solution, but refused to comment further.
Game’s 600-store estate in the UK operating under the Game and Gamestation brands is likely to be whittled down in the administration process before being sold on.
US-rival GameStop – which has a minimal presence in the UK – is seen as the frontrunner to buy the company, with analysts saying it is likely to be interested in some of the UK stores and assets, such as its prized database of 18,000 loyalty scheme customers. The US games giant is also understood to be circling the firm’s Iberian business.
Private equity firm OpCapita may also table a bid, however sources familiar with the company said it is less likely to make a second offer after an initial bid to buy out the lenders’ debt and pay suppliers in full was given the cold shoulder.
Game’s woes came to a head this month as banks restricted their lending and major game makers refused to supply Game under new terms. Last week Game admitted there was no value left in the firm.