GAME Group administrator PriceWaterhouseCooper believes a sale of the specialist retailer is achievable.
Confirming that GAME had this morning entered administration, Mike Jervis, joint administrator and partner at PwC, said he felt there was room in the UK for a specialist video game shop.
"The group has faced serious cashflow and profit issues over the recent past," he said. "It also has suffered from high fixed costs, an ambitious international roll-out and fluctuating working capital requirements.
"Despite these challenges, we believe that there is room for a specialist game retailer in the territories in which it operates, including its biggest one, the UK. As a result we are hopeful that a going concern sale of the business is achievable."
GAME Group's 5500 UK and Ireland staff are being notified of the administration and warned about closures and layoffs. The company has 609 stores in the UK and Ireland.
Thoughts now turn to a potential buyer. US giant GameStop is rumoured to be interested. A bid from Comet parent company OpCapita was blocked by GAME Group's lending syndicate, led by the Royal Bank of Scotland. Media reports suggest RBS has tabled its own bid.