After a tumultuous few weeks, GAME has officially entered administration as of Monday, March 26. The news follows GAME’s inability to stock the popular Mass Effect 3, as well as all subsequent EA titles.
Announcing the decision to go into administration, GAME released the following statement:
“Further to our announcements of March 21, the Board of GAME has completed its discussions with lenders and third parties without resolution, and has therefore today appointed PWC LLP to act as administrators for the Group. This decision is taken after careful consideration and ceaseless interrogation of every possible alternative. The Board would like to thank the teams of GAME and Gamestation colleagues around the world for their exemplary dedication, passion and professionalism.”
Administration is basically a British legal term where a company hands over its management to an outside source in hopes of saving it from absolute bankruptcy. GAME’s chosen administrators, professional restructuring firm PricewaterhouseCooper (PwC), blame GAME’s difficulties on ‘cashflow and profit issues’ as well as ‘high fixed costs, an ambitious international roll-out and fluctuating working capital requirements.’
More bad news followed the decision to go into administration, as PwC announced the immediate closure of 277 of GAME’s UK stores, resulting in a total redundancy of 2,104 people. Gamestation, which is owned by GAME, unfortunately shares the same fate as its parent company.
The remaining stores will still be open for business, though their future will hinge on PwC’s ability to find a buyer for the ailing retailer. Yet despite the apparent doom and gloom, PwC is still optimistic about GAME’s long-term future.
“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,” said the firm. “As a result we are hopeful that a going concern sale of the business is achievable.”
GAME’s website is currently ‘down for maintenance’ instead displaying notice of the company’s administration. The site also bares the news that, effective immediately, GAME will no longer be accepting gift cards or reward cards.
GAME and Gamestation have been a key presence on every town high-street since I was a child, so it’s sad to see the company and its employees facing such difficulty right now. Inevitability, GAME’s difficulties will spark fresh debate surrounding the viability of brick-and-mortar stores in the face of digital distribution, but whatever the consensus all our thoughts go out to those affected who have lost their jobs. Here’s hoping you all land on your feet.
[MCV]
