OpCapita, a UK-based turnaround firm, has agreed to buy the remaining UK stores of stricken videogame retailer Game Group.
Game went into administration last Monday, immediately closing 277 branches with the loss of 2,104 jobs. However, OpCapita is to buy the remaining 333 stores from administrator PwC, potentially preserving some 3,200 jobs, it said in a statement.
Financial terms of the transaction were not disclosed, but the firm – which has formed a company called Baker Acquisitions to do the deal – is expected to take on a substantial portion of Game's outstanding debt. When the retailer entered administration, it owed some £85 million to a group of six banks, including the Royal Bank of Scotland.
The deal will see OpCapita buy what's left of the UK business out of administration and “provide it with the capital it needs to trade on a normalised basis”, the firm said. According to reports, it will also install David Hamid – one of the firm's operating partners and a former chief executive of automotive accessories retailer Halfords – as executive chairman of Game as it looks to turn the ailing business around.
Henry Jackson, managing partner of OpCapita, insisted Game still had a reason to exist. “We strongly believe there is a place on the high street for a video gaming specialist and Game is the leading brand in a £2.8 billion market in the UK. We have assembled a strong team of experienced industry operators to implement the programme of operational change that is needed. There is a huge amount to do but we look forward to the challenge of restoring Game’s fortunes in partnership with its employees and suppliers.”
OpCapita added it was not expecting to close any further stores. In addition to those 3,200 jobs that would now be saved, it will also re-employ “a small number” of staff from Game's head office who were made redundant last week.
The firm, which was formerly known as Merchant Equity Partners, also recently acquired struggling UK electrical chain Comet for £2.