Game shares soar on revised banking facilities

 

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Shares in the video game retailer Game Group have jumped 40% after lenders, led by state-backed RBS, revised the firm's banking arrangements.

Game said the new arrangements would allow it "to continue to trade".

Game Group shares plunged by more than a third in November after the retailer cut its revenue forecast.

It is now predicting an underlying pre-tax loss of about £18m for the year to the end of January.

The firm has also agreed to provide an updated strategic plan for review by its lenders, which also include HSBC and Barclays.

All aspects of the business's activities and strategy will be reviewed, including its 664-store overseas operations.

"Management may look to exit parts or all of its international operations to reduce losses and to raise cash," said Singer Capital Markets analyst Mark Photiades.

In September, Game reported a £51.5m pre-tax loss and its share price has fallen over 70% since the start of the year.

Game has seen its business eroded by competition from online-only retailers such as Steam and Amazon, with Game holding on to 19% of the online market.

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