There’s no bigger character on the UK high street than Mike Ashley. His acquisition of a significant holding of GAME shares today is the biggest story for UK games retail in years. Does it show the sector’s key retailer is simply undervalued or is this the beginning of a long-running saga of unwanted attention?
While the retail tycoon has his fingers in many pies, to date he has largely operated within the sport, leisure and apparel sector - buying significant stakes in many businesses rather than taking them over entirely - although the recent buyout of luxury lingerie brand Agent Provocateur shows that he's willing to experiment.
His acquisition of GAME stock follows recent patterns then. The company is undoubtedly struggling, as was Agent Provocateur, with Ashley buying in at 21p a share, after a recent profit warning, a price which has been decimated just two years after the company was refloated at 200p a share. While the size of the stake is similar to that he reportedly owns in Blacks and JJB Sports.
Apart from the odd branded t-shirt, though, GAME isn't a clothing retailer. However it's aimed squarely at the same young, male demographic that his core business largely serves. So Ashley must feel he's on safe territory here - or as much as you can with a weakened pound and a poor overall outlook for the retail sector.