Opcapita deal to save remaining Game operations
More than 3,000 jobs are expected to be saved by a deal to rescue part of struggling retailer Game Group by a turn-around investment firm in a boost for the high street.
Opcapita, which recently bought electrical goods retailer Comet, is set to announce that it is buying a substantial part of the computer games chain, keeping open 333 shops and saving 3,100 jobs, the BBC said.
The UK operations of the retailer, which trades as Game and Gamestation, collapsed into administration on Monday, triggering 277 store closures and 2,104 redundancies.
Administrator PricewaterhouseCoopers, which was not immediately available for comment, has been searching for a buyer for the business while the remaining shops were kept open.
Some 231 Irish jobs were axed at the retailer this week as all 14 stores in the Republic shut, with just five of 20 stores in the North to stay open.
The retailer had outlets in Athlone, Galway, Limerick and Monaghan, as well as two stores in Cork and eight in Dublin.
Opcapita is believed to have paid a nominal amount, believed to be £1, for Game's assets.
However, the real cost will be taking over the company’s £85m (€1002m) debts. It is understood the company’s lenders, led by Royal Bank of Scotland, will have agreed to roll forward the debts at the same time as taking a slight reduction.
OpCapita was among a number of potential bidders for the remaining assets including a consortium of existing banks including RBS and American rival Gamestop.
OpCapita, which bought Comet for a token £2, specialises in investing in and turning around stricken retail chains.
Game’s demise followed a string of profit warnings and the failure of nervous suppliers, including Electronic Arts and Nintendo, to go on providing new games.
The retailer had a £21m rent bill due last week and faces a £12m wage bill this weekend, although PwC is expected to honour any wages owed. There is also £10m in VAT and £40m owed to suppliers.
Game suffered a dismal Christmas and was later forced to ask suppliers for more generous trading terms.
But many stopped supplying it with new releases, such as Mass Effect 3 and Street Fighter X Tekken, leaving fans disappointed and adding to the group’s trading woes.
Game agreed fresh lending facilities with banks last month and began seeking access to alternative sources of funding earlier this month.
The group has already signalled that losses for the year to the end of January are likely to be around £18m.
