The company today said it plans to carry on trading during the moratorium period offered by the voluntary administration, which will protect it from creditors for 10 days while it continues discussions with lenders and third parties over the future of the business.
“The board has concluded that its discussions with all stakeholders and other parties have not made sufficient progress in the time available to offer a realistic prospect for a solvent solution for the business,” it said in a statement.
The news follows an earlier announcement that trading in Game Group shares had been suspended after the retailer, which also operates 650 sites overseas, admitted there was no equity value left in the business.
The business had been in an increasingly desperate position over the past weeks as a growing number of video game publisher’s including Electronic Arts, Nintendo and Capcom, refused to supply it. Game Group issued a string of profit warnings in 2011 and is set to end its financial year with an £18m loss.
Shares had plunged from a high of more than 60p a year ago and closed yesterday at 2.39p.
Supermarkets have benefitted from the business’s woes, reporting a hike in sales of the tiles Game Group has been unable to supply.