Game Receives Clearance For Gamestation Takeover

Computer game retailer Game have today seen the price of shares increase drastically on the back of receiving regulatory clearance for its proposed takeover of rival Gamestation, which could see the company increase its market share and geographical reach throughout the UK.

The Competition Commission today announced that the proposed takeover deal would not be contrary to competition rules which would have a distorting effect on the industry, valued at approximately £74 million for the major high street game retailers’ takeover.

Whilst the Commission did pass the transaction it was only with the discretion of the chairman in his role as casting vote, in order to give assent to the agreement which would tie up a substantial market share for the new larger games retailing group.

The Game Group currently operates around 800 outlets in total throughout Europe and Australasia, whilst Gamestation operates a reduced number of just 200 outlets, thus increasing the size of the Game operation by 25% upon completion of the takeover bid.

The Commission had initially been torn on the legitimacy of the deal, fearing that it may lead to a lack of competition within the market and may give the group an unfair advantage over competitors. However with the chairman’s casting vote, the deal was allowed to pass.

Shares in the company were today up 16% off the back of the news, seeing a closing price of 209p a share in anticipation of the successful completion of the takeover deal, which it is hoped will go through over the course of the next few weeks.

It remains to be seen whether the expansion will realise a return in profitability for the Game group over the course of the next few months.

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