Retailer invests in GAME despite the U.K. retailer’s current sales shortfall.
EUROPE- U.K. retailing group Sports Direct International has taken a 26 percent stake in beleaguered U.K. video game retailer GAME, in a move designed to give the traditional sports retailer a foothold in the growing eSports segment.
The news came just weeks after GAME issued a profit warning to investors, saying that sales for the full financial year would be "substantially below previous expectations" due in part to Nintendo Switch stock shortages and the softening of Xbox and PlayStation sales.
Shares in the company dropped dramatically following the announcement, and Sports Direct was consequently able to pick up 44 million at a rock bottom price (23 pence or 30 cents at the time of the announcement).
“GAME is pleased that the strategic value of the group has been recognized by Sports Direct through this acquisition,” said the company in a statement. “The group looks forward to working collaboratively with Sports Direct to explore the clear opportunities that a constructive partnership and collaboration can deliver for all stakeholders in the gaming, live events and rapidly growing eSports markets in which it operates.”