GMD.L Regulatory News (GMD)

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN OR ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO RELEASE, PUBLISH OR DISTRIBUTE THIS ANNOUNCEMENT.

This announcement is not an offer to sell, or a solicitation of an offer to acquire, securities in the United States or in any other jurisdiction. This announcement is an advertisement and not a prospectus. Investors should not purchase or subscribe for any transferable securities referred to in this announcement except on the basis of information contained in any prospectus (the "Prospectus") in its final form that may be published by GAME Digital plc, a new English holding company (the "Company") for the GAME group of companies (the "Group" or "GAME") (which, with effect shortly prior to Admission (as defined below), will consist of Capitex Holdings Limited ("Capitex") and its subsidiary GAME Retail Limited ("GRL"), and Cherrilux Investments S.à r.l ("Cherrilux") and its subsidiary GAME Stores Iberia SLU ("GSI")), in connection with the admission of the Company's ordinary shares (the "Ordinary Shares") to the premium listing segment of the Official List of the UK Listing Authority (the "UKLA") and to trading on London Stock Exchange plc's Main Market for listed securities (the "London Stock Exchange") ("Admission").

Full details of the Offer will be included in the Prospectus, expected to be published and available on the Company's website later today. Following its publication, the Prospectus will (subject to certain access restrictions) be available online at www.gamedigitalplc.com.

FOR IMMEDIATE RELEASE

6 June 2014

GAME Digital plc

Initial Public Offering - Announcement of Offer Price

Offer Price set at 200 pence per Ordinary Share

GAME Digital plc, the leading omni-channel specialist retailer of video games in the UK and Spain, today announces the successful pricing of its initial public offering (the "Offer").

Offer Highlights

· The offer price has been set at 200 pence per Ordinary Share (the "Offer Price").

· Based on the Offer Price, the total market capitalisation of GAME at the commencement of conditional dealings will be £340 million.

· The Offer of 60,409,046 Ordinary Shares represents 35.5 per cent. of the enlarged issued share capital of the Company following completion of the Offer.

· The Offer is expected to raise gross proceeds of approximately £121 million for the Company and Selling Shareholders.

· The Company expects to receive gross proceeds of £20 million from the issue of New Shares in the Offer.

· Duodi Investments S.à r.l (the "Major Shareholder") (an investment vehicle in which the majority interest is ultimately owned by Elliott International LP and Elliott Associates LP, being funds in respect of which Elliott Capital Advisors LP is the general partner and in respect of which Elliott Advisors (UK) Limited is a sub-advisor to the funds' investment services provider) and certain Directors (collectively, the "Selling Shareholders") expect to receive gross proceeds of approximately £101 million from the sale of Existing Shares in the Offer.

· Conditional dealings in the Ordinary Shares will commence on the London Stock Exchange at 8.00 a.m. today under the ticker GMD (ISIN: GB00BMP36W19).

· Admission to the premium listing segment of the Official List and to trading on the London Stock Exchange's Main Market for listed securities, and the commencement of unconditional dealings, are expected to take place at 8.00 a.m. on 11 June 2014.

· At Admission, the Company will have 170,000,000 Ordinary Shares in issue.

· It is expected that following Admission the Company will become eligible for inclusion in the FTSE UK indices.

· In relation to the Offer, Canaccord Genuity Limited ("Canaccord Genuity") is acting as the financial adviser, Sole Sponsor and Joint Bookrunner, and HSBC Bank plc ("HSBC") and Liberum Capital Limited ("Liberum") are acting as Joint Bookrunners.

Employee share awards and Virtual Loyalty Share Plan

· The Company has established a performance share plan (the "PSP"), an all-employee share ownership plan (the "SIP") and an all-employee sharesave plan (the "SAYE Plan"). It proposes to make one-off awards of nil-cost options over Ordinary Shares under the PSP with effect from Admission and awards of free Ordinary Shares under the SIP shortly after Admission.

· Certain Directors and selected senior employees will be granted awards over Ordinary Shares under the PSP.

· All UK employees have been offered awards under the SIP conditional on, and with effect from shortly after, Admission, over Ordinary Shares with an aggregate value of up to £1 million (the "Initial Awards").

· The Major Shareholder will transfer Ordinary Shares with a value equal to £3.6 million at the Offer Price to the Company's employee benefit trust ("EBT") with effect from Admission, which will be used to satisfy the Initial Awards under the SIP together with the majority of awards to senior employees under the PSP.

· The Company has established a Virtual Loyalty Share Plan in order to reward 20,000 of its most loyal customers in the UK and will gift them virtual loyalty shares which will track the value of the Ordinary Shares ("Virtual Loyalty Shares") from, or shortly after, Admission. On Admission, the aggregate value of the Virtual Loyalty Shares to the Group's customers will be £2 million. The cost of providing this Virtual Loyalty Share Plan will be largely funded by the Major Shareholder.

Martyn Gibbs, Chief Executive of GAME Digital plc said:

"GAME Digital is a profitable and cash generative business with a great team, strong supplier partnerships and exciting digital growth opportunities. These fundamentals have enabled us to attract high quality investors who we welcome into our business.

We are a truly specialist retailer, with a loyal customer base, operating in a growing market. Our supplier partners are producing increasingly advanced gaming content, for which we will continue to develop and facilitate new ways to buy and play. The business is well-placed for the future."

Enquiries

GAME Digital plc +44 (0) 1256 784000

Martyn Gibbs, Chief Executive Officer

Benedict Smith, Chief Financial Officer

James Staveley, Investor Relations & Corporate Development Director

Financial Adviser, Sole Sponsor and Joint Bookrunner

Canaccord Genuity +44 (0) 20 7523 8000

Alexis de Rosnay

Bruce Garrow

Cara Griffiths

Emma Gabriel

Joint Bookrunner

HSBC +44 (0) 20 7991 8888

Stuart Dickson

Andrew Judge

Richard Fagan

Joint Bookrunner

Liberum +44 (0)20 3100 2222

Peter Tracey

Christopher Britton

Media Enquiries

Citigate Dewe Rogerson +44 (0) 20 7638 9571

Tom Baldock +44 (0) 20 7282 2889

Grant Ringshaw +44 (0) 20 7282 2851

Jos Bieneman +44 (0) 20 7282 1053

Notes to Editors

Except where the context otherwise requires, defined terms used in this announcement have the meanings given to such terms in the Prospectus to be published by the Company and expected to be dated 6 June 2014.

OFFER STATISTICS

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Each of the times and dates in the above timetable is subject to change. References to times are to London time unless otherwise stated.

1) The proceeds receivable by the Company are stated after deduction of estimated underwriting commissions and other fees, taxes and expenses of the Offer payable by the Company, which is expected to be approximately £8 million in aggregate (assuming that the full discretionary fee is paid to the Underwriters). The Company will not receive any of the net proceeds from the sale of the Existing Shares in the Offer.

2) The proceeds receivable by the Selling Shareholders are stated after deduction of estimated underwriting commissions and stamp duty, which is expected to be approximately £4 million in aggregate (assuming that the full discretionary fee is paid to the Underwriters).

3) It should be noted that, if Admission does not occur, all conditional dealings will be of no effect and any such dealings will be at the sole risk of the parties concerned.

4) No temporary documents of title will be issued.

5) Save in respect of conditional dealings, settlement will be on a T+3 basis.

Forward-looking statements

This announcement includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, such as the terms "believes", "estimates", "forecasts", "plans", "prepares", "anticipates", "expects", "intends", "may", "will", "could" or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include all matters about future events, developments and financial results as well as other statements that do not relate to historical facts and events. They appear in a number of places throughout this announcement and include statements regarding the intentions, beliefs or current expectations of the Group and the Directors concerning, among other things, financing strategies, results of operations, financial condition, prospects and dividend policy of the Group and the markets in which it operates. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. These risks, uncertainties and other factors include the following:

• the Group's reliance on suppliers and vendors for sufficient quantities of products and for new product releases;

• trends that adversely affect the Group's operating model, including the introduction of new types of products, changes in technology and changes in consumer preferences;

• risks to the Group's pre-owned business posed by the introduction of features in the next-generation consoles and software, as well as manufacturer-imposed or regulatory restrictions, changes or conditions;

• general economic conditions in the markets in which the Group operates, in particular the UK and Spain, which affect consumer confidence and consumer spending;

• the Group's ability to implement its business strategy;

• the impact of changes in the methods of distribution of video game software and content;

• changes in the competitive environment in the video game industry, including increased competition from online suppliers of consoles and as a result of the increased popularity of mobile, social and browser gaming and other alternative means to play video games;

• seasonality of sales;

• the Group's ability to attract and retain qualified personnel; and

• data breaches involving customer or employee data and failure of the Group's information technology infrastructure.

Forward-looking statements are not guarantees of future performance and no assurance can be or is given that such future results will be achieved. The Group's actual results of operations, financial condition, dividend policy and the development of its financing strategies may differ materially from the impression created by the forward-looking statements contained in this announcement. In addition, even if the results of operations, financial condition and dividend policy of the Group and the development of its financing strategies are consistent with the forward-looking statements contained in this announcement, those results or developments may not be indicative of results or developments in subsequent periods. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements in this announcement may not occur.

Consequently, none of the Company, the Directors, the Selling Shareholders, Canaccord Genuity, HSBC, Liberum or their affiliates can give any assurances regarding the accuracy of the opinions set out in this announcement or the actual occurrence of any predicted developments.

Subject to their legal and regulatory obligations, the Company, Canaccord Genuity, HSBC, Liberum and their affiliates expressly disclaim any obligation to update or revise any forward-looking statement contained in this announcement to reflect any change in expectations with regard thereto or any change in events, conditions or circumstances on which any statement is based. All subsequent forward-looking statements that can be attributed either to the Company or to individuals acting on its behalf are expressly qualified in their entirety by this paragraph.

Important notice

This announcement does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any Ordinary Shares or any other securities, nor shall it (or any part of it) or the fact of its distribution, form the basis of, or be relied on in connection with, or act as an inducement to enter into, any contract or commitment whatsoever therefor.

Neither this announcement nor any copy of it may be made or transmitted into the United States, or distributed, directly or indirectly, in the United States. Neither this announcement nor any copy of it may be taken or transmitted directly or indirectly into Australia, Canada, Japan or Switzerland or to any persons in any of those jurisdictions, except in compliance with applicable securities laws. Any failure to comply with this restriction may constitute a violation of United States, Australian, Canadian, Japanese or Swiss securities laws. The distribution of this announcement in other jurisdictions may be restricted by law and persons into whose possession this announcement comes should inform themselves about, and observe, any such restrictions. This announcement is not an offer of securities for sale, or a solicitation of an offer to purchase securities in the United States, Australia, Canada, Japan or Switzerland or in any jurisdiction to whom or in which such offer or solicitation is unlawful.

The securities to which this announcement relates have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act") or with any regulating authority or under any applicable securities laws of any state or other jurisdiction of the United States, and may not be offered or sold within the United States unless registered under the Securities Act or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with applicable state law. There will be no public offer of the securities in the United States.

The securities referred to herein have not been registered under the applicable securities laws of Australia, Canada, Japan or Switzerland and, subject to certain exceptions, may not be offered or sold within Australia, Canada, Japan or Switzerland or to any national, resident or citizen of Australia, Canada, Japan or Switzerland.

In the European Economic Area (the "EEA"), this announcement is addressed only to, and is directed only at, persons in member states of the EEA who are "qualified investors" within the meaning of Article 2(1)(e) of EU Directive 2003/71/EC (the "Prospectus Directive"), as modified by EU Directive 2010/73/EU, in each case as implemented in the relevant member state of the EEA ("Qualified Investors"). In addition, this announcement is being distributed only to, and is directed only at (a) in the United Kingdom, (i) Qualified Investors who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") (Investment professionals), (ii) Qualified Investors who fall within Article 49(2)(a) to (d) of the Order (High net worth companies, unincorporated associations etc.) or (iii) Qualified Investors to whom it may otherwise be lawfully distributed or at which it may otherwise lawfully be directed and (b) outside the United Kingdom, persons to whom it may otherwise be lawfully distributed or at which it may otherwise lawfully be directed (all such persons together being referred to as "relevant persons"). Any investment or investment activity to which this announcement relates is available only to relevant persons and will be engaged in only with relevant persons. This announcement must not be acted on or relied on by persons who are not relevant persons.

This announcement is an advertisement and not a prospectus. Investors should not subscribe for or purchase any transferable securities referred to in this announcement except on the basis of information in the Prospectus expected to be published by the Company later today, 6 June 2014, in connection with the Admission. Copies of the Prospectus will, following publication, be available from www.gameditigalplc.com, subject to applicable securities laws, and at the Company's registered office.

Any subscription for or purchase of Ordinary Shares in the proposed Offer should be made solely on the basis of the information contained in the final Prospectus to be issued by the Company in connection with the Offer. Before subscribing for or purchasing any Ordinary Shares, persons viewing this announcement should ensure that they fully understand and accept the risks which will be set out in the Prospectus when published. The information in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness.

This announcement does not constitute a recommendation concerning the Offer. The price and value of securities and any income from them can go down as well as up. Past performance is not a guide to future performance. Before subscribing for or purchasing any Ordinary Shares, persons viewing this announcement should ensure that they fully understand and accept the risks that will be set out in the Prospectus, when published. Information in this announcement or any of the documents relating to the Offer cannot be relied upon as a guide to future performance. There is no guarantee that Admission will occur and you should not base your financial decisions on the Company's intentions in relation to Admission at this stage. Potential investors should consult a professional advisor as to the suitability of the Offer for the entity concerned.

Canaccord Genuity (which is authorised and regulated in the United Kingdom by the Financial Conduct Authority ("FCA")), HSBC (which is authorised by the Prudential Regulation Authority ("PRA") and regulated by the FCA and the PRA in the United Kingdom) and Liberum (which is authorised and regulated in the United Kingdom by the FCA) (collectively, the "Banks") are each acting exclusively for the Company and no one else in connection with the Offer and will not regard any other person as their respective client in relation to the Offer and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients or for giving advice in relation to the Offer or the contents of this announcement or any transaction, arrangement or other matter referred to herein.

In connection with the Offer, the Banks or any of their respective affiliates, acting as investors for their own accounts, may subscribe for or purchase Ordinary Shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such Ordinary Shares and other securities of the Company or related investments in connection with the Offer or otherwise. Accordingly, references in the Prospectus, once published, to the Ordinary Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, the Banks or any of their respective affiliates acting as investors for their own accounts. The Banks or any of their respective affiliates do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligation to do so.

None of the Banks, nor any of their respective subsidiary undertakings, affiliates or any of their respective directors, officers, employees, advisers, agents or any other person accepts any responsibility or liability whatsoever for, or makes any representation or warranty, express or implied, as to the truth, accuracy, completeness or fairness of the information or opinions in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Group, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection therewith.

The contents of this announcement, which have been prepared by and are the sole responsibility of the Company, have been approved by Canaccord Genuity solely for the purposes of section 21(2)(b) of the Financial Services and Markets Act 2000 (as amended).

Certain figures in this announcement, including financial information, have been subject to rounding adjustments. Accordingly, in certain instances, the sum or percentage change of the numbers contained in this announcement may not conform exactly with the total figure given.