Fears over Game's future after leading supplier refuses to deliver new release
Fresh concerns were raised over Game Group's future yesterday, after a leading games company refused to supply it with its latest products over concerns about its creditworthiness.
Shares in the retailer crashed by 16 per cent to 4.92p after an internal memo yesterday said Electronic Arts had rejected its plea for relief on its credit terms to sell the Mass Effect 3 game due for release next week.
The retailer, which is trying to sell its 663-store overseas business, "apologised sincerely" and guided customers to EA's website and rivals Amazon, Play, Zavvi and shopto.net.
Game is battling not only these internet specialists and a proliferation in digital downloading of games, but also a brutal consumer slowdown in spending on its products.
The retailer, which has 610 shops in the UK, warned on profits in January for the second time in three months. It made a loss of £18m for the year to 31 January.
In the memo, Tom Devine, the group's channel director, said: "We will not stock products if the terms are not right for our business – we will not sacrifice long-term credit requirements for short-term sales opportunities.
"As a result of us taking this position – a position that we believe is critical to our long-term health as a business – we have taken the very difficult decision not to stock EA's March releases, including Mass Effect 3."
It is unclear if Game will stock Nintendo's Mario Party Nine game.
Game's future had looked brighter earlier this month when its lenders relaxed the terms of its loans.
On a conference call with investors last month, EA's chief executive, John Riccitiello, said: "We are concerned with the financial condition of one of our major European retail partners, which could lead to both increased bad debt and lost sales." It is understood that Mr Riccitiello was referring to Game.
On EA, a Game spokesman said: "Both businesses are already engaged in discussions about future launches together. It is always a matter of regret when customers are inconvenienced, and both the group and EA are committed to ensuring that this situation does not occur again."
arts + entsThere were towering ideas, some scintillating performances and revelatory grooves... our writers pick out their personal highlights
elephant appealThe first 23 lots in our charity auction have now gone. But there are 22 more still up for grabs
elephant appealPrince William signs up for our charity appeal
peoplePrepare to be entranced by worms as the molecular biologist gets ready to give the Royal Institution science lectures
elephant appealSo says man jailed for cutting off dead elephant's tusks
booksWe examine the best titles for teens
voicesPeople moan that Christmas is too commercial, the spirit lost. But it is a time to over-indulge, and always has been, says DJ Taylor
scienceResearchers teach border collie to understand sentences using more than 1,000 words
booksA Christmas story in six parts
travelWill high-value tourism help the workshops of this Renaissance city?
food + drinkA trifle without custard? Surely not! Nonsense – and here’s three to finish your festive meal that prove it
Geoffrey Macnab does not like the comedian's big screen debut
Top PR exec Justine Sacco under fire for sending racist tweet before flying to Africa
French pub fined €9,000 after customers returned empties to bar - because it's 'undeclared labour'
Ten best places to live in the UK: Hart in Hampshire takes top spot
'Untrue statements' anger over work to make H5N1 bird-flu virus MORE dangerous to humans
Paul Walker's daughter Meadow attends Justin Bieber Believe premiere
- 1 Top PR exec Justine Sacco under fire for sending racist tweet before flying to Africa
- 2 French pub fined €9,000 after customers returned empties to bar - because it's 'undeclared labour'
- 3 Sun will 'flip upside down' within weeks, says Nasa
- 4 The publisher who played with fire: the battle for control of Larsson's £30m legacy
- 5 Police seize possessions of rough sleepers in crackdown on homelessness
- < Previous
- Next >
iJobs Money & Business
£59999 - £80001 per annum + Benefits: Pro-Recruitment Group: A Top 10 firm in ...
£50000 - £75000 per annum + benefits + bonus: Harrington Starr: Project Manage...
£60000 - £90000 per annum + benefits + bonus: Harrington Starr: Business Analy...
£Negotiable: Citifocus: High calibre individual with institutional client serv...