Article written by Peter Chapman.
Published on 26/03/2012 at 09:00 AM.
MCV's controversial cover might be about to become literally true.
Last week, they took the first steps towards administration by filing a Notice of Intention to Appoint an Administrator. Failing any last minute rescue deals, it looks like this week might see that administration finally come into action. That would mean a true fire sale of assets that some are claiming will be as bad as Woolworths collapse a couple of years ago. During that sale, I saw downbeat Woolworths staff actually selling their shelves to customers.
It seems like Game Group PLC (which also includes Gamestation, remember) has failed to put together a pre-pack deal that appeals sufficiently to a buyer that the business could be bought out as it stands for a reasonable return.
Swirling rumours of a swoop from GameStop seem like smoke in the wind too, thereâ€™s been no firm word of that company doing anything more than standing on the sidelines watching with interest, although theyâ€™re a logical choice if we want to pin our hopes on a rescuer.
So what does that mean? Well, it means that the business as it stands isnâ€™t an attractive prospect for the buyers that were showing an interest. If talks have collapsed, those buyers are now likely to wait and see what the administration period resolves and may make offers to buy any assets of the business which they think are likely to be useful. Someone may wait a few weeks for all the worthless copies of FIFA 08 to be sold off at 5p a disc and then make an offer for key stores or logistical networks.
Above all, it means a longer period of uncertainty for the company and its thousands of employees.
Surely thatâ€™s the most heartbreaking element of this whole sorry story: the effect it will have on the lives of thousands of employees who depend on Game Group for their wages. As an outsider looking in, I canâ€™t help but feel that the business hasnâ€™t lived up to its potential over the past few years. Hindsight is a wonderful thing, of course, but Game Groupâ€™s failure to meet the rising digital sales market adequately and their inability to effectively offer an alternative to online retailers and their tax-haven discounts have been crippling. But those things are certainly not the fault of the regular Game or Gamestation employee.
So today, as we all sit waiting to hear the continuing story of Game Groupâ€™s financial insecurity unfold, weâ€™re sparing a thought for those normal staff members who have carried on turning up for work, serving the gaming community and doing their best for the company and for themselves in what must be a truly dispiriting time. Best of luck to all involved.
main page photo credit: Johnny Green/PA Wire