Game Digital

Game Digital

Mike Ashley snaps up 25% stake in GAME

Mike Ashley's Sports Direct business has snapped up 44 million shares in struggling retailer Game.

The 44 million shares acquired by Ashley is equivalent to 25.75% of the share capital of the group.

Sports Direct has taken significant strategic equity stakes in a number of retail and brand businesses across both the UK and USA in recent years in a bid to broaden its reach.

This newest deal however could see Sports Direct tap into the lucrative eSports market, which is fast establishing itself in the UK having already grown rapidly in Europe, the US and Asia.

In a statement, Game said: "The group looks forward to working collaboratively with Sports Direct to explore the clear opportunities that a constructive partnership and collaboration can deliver for all stakeholders in the gaming, live events and rapidly growing esports markets in which it operates."

Adam Tomlinson, an analyst at Liberum, said: "We see a number of reasons how Game and Sports Direct can gain from a closer working relationship but it is surely the similar customer demographics that must be the key draw card here.

"The strategic play is not likely to have any concern with reference to the console cycle but rather growth in e-sports, Insomnia events and in-store gaming.

"The UK's eSports industry is relatively nascent, with around 6.5 million UK eSports participants (NewZoo), vs. 256 million worldwide, and this is expected to reach c. 350 million within three years."

Shares in Game have risen by over 11% since the news broke this morning.