Gameplay on last legs?
Boxed Games division sold for £1, rest of company struggles on
During the internet boom Gameplay was the market's golden boy, with shares rising into nose-bleed territory and peaking at over £10 a pop just before the big dot.com crash in March 2000. The soaring share price had funded a string of ill-advised take-overs across Europe, and when the bubble burst Gameplay found itself spiralling into debt as its bloated organisation floundered. Earlier this year it laid off around 275 workers as part of a restructuring plan, and admitted that it was looking for a buyer for part or all of its operations.
Today the company confirmed earlier rumours that its Boxed Games division has been given away in a management buy-out. The UK operation was sold for a token £1, while its Nordic branch went for a song at 1 Swedish Krona (about 7p at current exchange rates). The Spanish division is still being negotiated over, while the German group has filed for insolvency after failing to find a buyer. Further announcements are expected by the end of the month, and it's unlikely to be good news - "lower-than-expected proceeds from the sale of these assets mean that the company may not now have sufficient cash to reach profitability" according to a statement issued by Gameplay. The company's share price plunged to just 5p at one point, shedding 60% of its remaining value in just a couple of hours.
Gameplay's remaining Technology division now appears to be living on borrowed time, with take-over discussions with an unknown third party falling through, and the sale of its Boxed Games division failing to raise any money. Sadly this could mark the beginning of the end for their popular online gaming service Wireplay, which has been providing servers for the British gaming scene for some years now, making it (along with Barrysworld) one of the longest surviving gaming service providers in the country.