Sports Direct International plc made an offer to acquire the remaining 61.51% stake in GAME Digital plc from Marlborough Unit Trusts - Marlborough UK Micro-Cap Growth Fund, fund managed by Marlborough Fund Managers Limited and others for £31.9 million.
Sports Direct intends to work with the GAME management team to develop and review GAME's existing strategic programme. The review will cover areas including the location, size and lease terms of GAME's sites, its headquarters and distribution centre, its product and services mix, and other key aspects of GAME's business and operations. The review could result in consolidation or closure of GAME sites and a consequent reduction or relocation in the employment of GAME's employees and management (and those of its subsidiaries) and a change in the balance of skills and functions. The review may also result in changes to the headquarters, headquarters functions and distribution centre and to the general operations of GAME. Sports Direct has no intention of changing the research and development functions of GAME, of making any material change to the conditions of employment or making any changes to employer contributions into GAME's pension schemes, the accrual of benefits for existing members and the admission of new members, nor the redeployment of the fixed assets of GAME.
The offer will lapse if any matter arising from the offer constitutes a concentration with a European Community dimension within the scope of the EUMR, the European Commission either initiates proceedings or makes a referral to a competent authority and there is then a CMA Phase 2 reference; or the Offer becomes subject to a CMA Phase 2 reference. If the Offer becomes, or is declared, unconditional in all respects and Sports Direct receives acceptances of the Offer in respect of, and/or otherwise acquires (together with those acting in concert with it), 90% or more of the GAME Shares to which the Offer relates and 90% or more of the voting rights attaching to such shares, Sports Direct intends to exercise its rights to acquire compulsorily, on the same terms as the offer, the remaining GAME Shares in respect of which the offer has not at such time been accepted. The offer is subject to valid acceptance of 50% of the voting right and approval of GAME shareholders. As on June 21, 2019, the board of GAME recommended the GAME shareholders to accept the offer. The offer period (as defined in the Takeover Code) that commenced on June 5, 2019 and ending on the earlier of the date on which the offer becomes or is declared unconditional as to acceptances and/or the date on which the offer lapses or is withdrawn. As of June 20, 2019, the offer will remain open for acceptance till July 11, 2019. The consideration will be settled by no later than July 25, 2019. As of July 8, 2019, Sports Direct has received acceptances for 15.82% stake and holds 54.31%. The offer become unconditional in all aspect. As of July 12, 2019, Sports Direct has received acceptances for 45% stake and holds 83.88%. As of July 26, 2019, the transaction is approved by European Commission.
Luke Bordewich, Stuart Ord, Tom Ballard, George Fry of Numis Securities Limited acted as sole financial advisor to Sports Direct and Jos Bieneman, Nick Hayns and Michael Russell of Citigate Dewe Rogerson Ltd. acted as financial advisor to GAME Digital plc. Sports Direct will pay £0.25 million fee to Numis, if the offer resulted in Sports Direct holding up to 49.9% stake in GAME. The fee will be £0.5 million, if the offer resulted in Sports Direct holding above 50% stake in GAME. Chris Robinson and Bobbie Hilliam of Canaccord Genuity Limited acted as financial advisors for GAME. Sports Direct will pay £0.2 million in legal advice.