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UK video game retailer specialist, GAME, has called in a property consultancy to review its property portfolio, potentially leading to store closures, relocations, and job cuts.
As reported by Retail Gazette and spotted by GI.biz, a spokesperson from property consultancy CBRE, James Keany, said it was advising GAME on its 259 video game stores and 21 Belong esports arenas.
Keany said the firm would also be working “alongside” Sports Direct which is also owned by Mike Ashley, who has an 84 per cent stake in the video game retailer. Keany added there was a “significant opportunity” the company will restructure its current portfolio, “with store closures and relocations on the cards”, according to Retail Gazette.
“The existing Game portfolio has an average unexpired term of less than 0.8 years which offers a significant opportunity to re-structure the current portfolio,” Keany said. “There will be a combination of closures and relocations, with the focus being Belong, their exciting esports gaming platform.”
Though Keany would not comment on how many stores could potentially close, they said decisions to close or relocate stores would “depend on negotiations with landlords”.
Ashley first took an interest in the game retailer in 2017 after securing a 26 per cent share in the company. He then invested a further £3.2m for 50 per cent of the profits and IP ownership of GAME’s exhibition spaces, Belong, including a deal to set up Belong arenas in Sports Direct stores with possible GAME concessions. As rules stipulate that when a shareholder’s stake goes above 30 per cent a takeover offer must be made, GAME’s board of directors accepted Sports Direct’s mandatory cash offer made on June 5th at the end of June 2019.
The High Street retailer said in an announcement at the time: “The board has been considering the merits of the mandatory offer and consulting with its major shareholders and advisers, whilst also actively engaging in normal course discussions with Sports Direct and its advisers during this time.
“Whilst the board is disappointed that Sports Direct decided to issue its offer document unilaterally whilst these discussions were ongoing, the board has unanimously concluded, following a period of detailed deliberation and having been so advised by Canaccord Genuity Limited, that 30 pence per share represents a fair value for the group and intends, therefore, to recommend that shareholders accept the mandatory offer, as those members of the board who hold GAME shares intend to do.”
GAME has not, as yet, responded to requests for comment.
