Game buys Gamestation
Two biggest specialist games retailers in the UK become one in £74 million deal.
Game has acquired 217 Gamestation stores across the UK and Ireland, bringing its total number of stores (including franchises) to 1,047 worldwide.
The company confirmed today that the deal had taken place for £74 million (approx $147 million) and that the company had unconditionally acquired Gamestation from video rental company Blockbuster UK Ltd.
The two separate brands will be retained, meaning Gamestation stores will keep their name. Gamestation will also continue to focus on its existing customer base, which consists primarily of preowned purchasers and male games enthusiasts.
The concessions run inside Blockbuster stores are not part of the deal and will "cease to operate under the Gamestation brand" by the deadline date of June 30.
Game expects that the deal will moderately enhance its earnings per share by the end of 12 months and that it is "anticipated to deliver synergies" of £7 million ($14 million) per annum after the end of two years.
Game's chairman, Peter Lewis, commented on the acquisition, "We are delighted to bring Gamestation into our portfolio and believe it has a strong future within the group. The Gamestation business is one we have long admired and is complementary to our existing business in terms of both store portfolio and target customer. ... I am confident that this transaction will add considerable value to Game and its shareholders over the coming years."
Gamestation reported revenues of £203.5 million ($405 million) in 2006, along with profits before taxation of £2.1 million ($4.2 million).
Over the past three years Game has made a number of acquisitions worldwide, including Maxi Livres in France, Games Wizards in Australia, and Spiderman in Norway. The company recently reported strong sales and a triple in profits in its 2006 financials.
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