Sports Direct’s £52 million bid for Game could give it “the ability to finally realise the potential of its Belong gaming arenas”, according to analysts.
Yesterday Mike Ashley’s Sports Direct tabled a £51.9 million bid for the British video game retailer, after upping its already significant stake in the retailer, which it has held since 2017, to 38.5 per cent.
Though Sports Direct has said does not believe that “Game is able to weather the pressures that it is facing” and has warned store closures could take place if the takeover is completed, this could spell good news for Game’s Belong gaming arenas.
Game launched the gaming arenas in 2017, marking an effort to remove its reliance on big ticket items like consoles and physical games, providing a space for gamers to experience the latest games and technology and partake in increasingly popular esports events.
“Mike Ashley’s offer to buy Game outright brings with it the possibility to give the gaming retailer the ability to finally realise the potential of its Belong gaming arenas,” GlobalData’s retail analyst Zoe Mills said.
“While Game launched the first arenas back in 2017, it has only grown to just over 20, despite the planned tie up with Sports Direct that was set to open its Belong arenas in up to 100 new locations.”
Sports Direct purchased a 50 per cent share of Belong’s intellectual property in February 2018, stating that it intended to help open arenas in Sports Direct stores and elsewhere in its increasing retail network.
“The acquisition can be mutually beneficial for both parties,” Mills added.
“While Game has struggled within its retail arm, now that Sports Direct controls House of Fraser, there is a clear option to utilise some of the increasingly redundant space in some of those stores. This will give Game the space it needs for its Belong arenas to cater to demand.”