Gameplay up for sale?
British company announces "strategic review"
Gameplay has announced that it is undertaking a "strategic review" of the company and its options for the future with the assistance of Commerzbank Securities. The ailing British company has confirmed that it has been in "informal discussions" with a number of other companies since it "restructured" (that's biz speak for sacking 275 staff) at the beginning of February. At the time Gameplay chairman Mark Strachan assured us that "there isn't a For Sale sign on Gameplay", after rumours emerged suggesting that Cisco was about to take a 20% stake in the British company. It's now looking likely that this statement was not entirely true.
The new strategic review will look at "all the options available to Gameplay, including progressing the discussions with third parties", which would presumably lead to some or all of the company's boxed games and technology divisions being sold off to the highest bidder. According to a short press release the company "remains committed to positioning Gameplay at the forefront of digital delivery of games but is equally committed to maximisation of shareholder value, particularly in the light of stock market conditions and the Company's current share price". Their shares peaked at over £11 a pop last spring, before plumetting to just a third of that about a month later in the dot-com crash. Since then their share price has continued to slip steadily and now stands at an all-time low of just 16p - a drop of more than 98% in the last year.
Gameplay says that "the current market valuation does not reflect the true underlying performance or potential" of the company, but unfortunately in the doom and gloom atmosphere currently hanging over much of the tech sector this is pretty academic. Just a year ago it seemed that Gameplay could do no wrong as they hung on to the leading edge of the dot-com bubble, swallowing several other companies across Europe in the process and expanding to cover everything from high street shops and internet gaming services to online magazines and the folly that was Blam! - a half hour weekly advert for Gameplay's online store, thinly disguised as a computer games lifestyle show. Today they look like another take-over target, following in the wake of Electronic Boutique's buy-out of Barrysworld and a string of redundancy notices and mergers across the British gaming industry and related companies.