James Delahunty
12 Mar 2012 23:04
UK video game retailer faces administration.
Shares of GAME took a nosedive on Monday after the firm told shareholders that their investment in the chain could be worthless. "It is uncertain whether any of the solutions currently being explored by the board will be successful or will result in any value being attributed to the shares of the company," the firm stated to investors.
GAME is still in talks with suppliers while sending some customers away to other stores to buy the latest releases, such as Mass Effect 3, and is seeking alternative sources of funding.
Shares in GAME had lost 94 percent of their value during the past year before Monday. It operates from 1270 stores in 9 European markets and Australia, and employs 10,000 staff. In two weeks time, the firm needs to make a large payment. Failure to do so could result in administration.
Recently, GAME has been shutting some of its stores and moving into digital distribution, hoping to avoid the fate of others in the music business in the past decade.