GAME shares drop 20% in a week

Retailer stock price hits new low after poor holiday season prompts major credit insurers to scale back coverage

It's been a difficult year for GAME Digital right from the start, and it doesn't seem to be getting much better. As reported by The Guardian last week, the company's credit insurers have reduced or eliminated a significant amount of their coverage last month after a second straight disappointing holiday season, and the stock has taken a beating since.

On the day of the report, GAME Digital shares were trading for 100 GBp. They have been trending downward since then, and as of this writing, were trading at 83 GBp after hitting a mid-day low of 80 GBp.

GAME Digital told investors that the credit insurer change "has had no material impact on the group's ability to purchase stock from suppliers on credit terms, though this may change as the group's peak trading period approaches." The Guardian reported that some insurers had increased their coverage since the initial warning was issued to shareholders, and GAME believes a new financing deal approved by shareholders last week should further help its position with credit insurers.

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