Game
Transaction Background
In 1993 Graphite Capital provided expansion finance to Game, a well known high street retailer of electronic games hardware and software. With further finance raised in later fundraising rounds, Game expanded from 12 to over 60 shops before floating in 1998. The company was subsequently acquired by Electronics Boutique, its principal competitor. The combined group now trades under the Game brand.
Deal Attractions
Game was founded when the electronic games market was still in its infancy. No national specialist retailer had emerged at that stage and the performance of Game’s first shops was encouraging. Neil Taylor, the co-founder, was an impressive entrepreneur and was capable of driving forward rapid expansion. New shop units were relatively cheap to open and proved to be profitable in most mid-sized and large UK towns.
Achievements
- the number of outlets grew rapidly, as standardised store formats were developed and rolled out to mid-sized and large shopping centres
- Game became the second largest specialist electronic games retailer in the UK
- the company weathered the storm of game technology cycles which had a significant impact on profit
- operating profit increased from near zero in 1993 to £7.1 million at flotation
Exit
- Game was listed on the London Stock Exchange in 1998
- Graphite sold half of its investment at the flotation
- in 1999 Game was taken over by Electronics Boutique
- we received total proceeds of £23.1 million which represented 7.9 times our costs and an IRR of 62 per cent
