GAME In Talks With Lending Syndicate
EA boss John Riccitiello has expressed concern at the financial health of one of their "major European retail partners"... and it doesn't take an analyst to work out which one he's referring to. GAME are facing major stock and credit difficulties at the moment, with their latest statement suggesting that they're currently negotiating with their lending syndicate for more financial headroom. The wording even suggests that a major sell-off of foreign interests might also be on the cards.
First things first. EA's head honcho, John Riccitiello, told investors that he's concerned about a European retailer who's saddled with debt and dwindling sales that could be passed on to publishers.
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.
CFO Eric Brown also suggests that there's trouble on the European front.
We are focused on some isolated European retailer issues that have recently been announced. A negative outcome could adversely affect our Q4 results.
Let's face it: they have to be talking about GAME. The beleagured high street vendor has revealed major stock and credit problems this week, with new titles failing to reach shelves in time for release. GAME have issued a statement suggesting that they're currently in talks with their banking consortium to solidify their situation... which could result in a "review of its overseas operations." Read: massive foreign sell-off and major cutbacks. Probably.
In response to press speculation the GAME Group plc confirms that it is in on-going dialogue with its lending syndicate to reach agreement on revised terms for its facilities. As part of these discussions, the lending syndicate is reviewing a strategic plan of the company which includes a review of its overseas operations.
A further announcement will be provided once discussions with its lending syndicate have concluded.
Us hacks will continue to speculate and keep you covered as the situation unfolds. Just in case, it might be worth considering cashing in your loyalty card...