Sports Direct buys 25.75% stake in gaming retailer Game Digital
UK-based retailer Sports Direct International has acquired 44 million shares in video game retailer Game Digital, which represents a 25.75% stake in the latter’s share capital.
Operating in the UK and Spain, Game Digital offers gaming products such as consoles, personal computers, handheld devices, physical and digital console content, as well as licensed merchandise.
In the first half yearly review last year, Game Digital stated that it operated 581 stores across these countries.
The retailer issued a statement saying: “GAME is aware that Sports Direct has taken significant strategic equity stakes in a number of retail and brand businesses across both the UK and US, and is a leading retailer which partners with major global brands and suppliers."
The company further noted that, through the collaboration, it will work towards meeting the needs of various stakeholders in the gaming, live events and e-sports markets.
In 2012, Game Digital was placed into administration, with global audit and advisory services firm PricewaterhouseCoopers acting as its administrator.
Following the administration exercise, the company was bought by UK private equity firm OpCapita.
According to OpCapita, Game Digital was finding it difficult to arrange financing for working capital due to a combination of factors during 2011, including the effects of the global financial crisis in the previous decade and growing cash requirements to meet its store network.
Soon after, some of the suppliers refused to provide goods to the company and banks reduced the working capital funding, which forced the retailer into administration and resulted in the closure of half of its UK stores.