Controversial UK retail chain Sports Direct has purchased a 25.75 percent stake in GAME, the UK's biggest high street video game specialist.
Despite its dominant position in the UK video game market, GAME has endured a difficult year. It recently posted a profit warning, citing the lack of Switch stock as a major problem. Back in 2012 the company entered administration and was purchased by OpCapita, but its share price has plummeted in value recently.
Following the news of the purchase, GAME's share price rallied from 20p to over 27.5p a share.
Here's GAME's statement on the news:
GAME is aware that Sports Direct has taken significant strategic equity stakes in a number of retail and brand businesses across both the UK and USA, and is a leading retailer which partners with major global brands and suppliers. GAME is pleased that the strategic value of the group has been recognised by Sports Direct through this acquisition of a 25.75% stake. 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.
This positive news is tempered by the fact that Sports Direct boss Mike Ashley - who has also invested in French Connection and Debenhams recently - has been mired with controversy in recent years. His Sports Direct retail chain has been criticised for poor pay and terrible working conditions.