Sept. 10 (Bloomberg) -- Game Group Plc, the U.K.'s largest video games retailer, fell the most since February in London trading on concern that discounts offered by William Morrison Supermarkets Plc and Woolworths Group Plc may fuel price cutting.

Game slid 23.5 pence, or 9.6 percent, to 220.5 pence after falling 6.2 percent yesterday. The two-day drop wiped out this year's gain in the stock and cut the Maidenhead, England-based company's market value to 764 million pounds ($1.3 billion).

``There is a big seller today on fears about software price cutting by Woolies and Morrisons,'' said Nick Bubb, a retailing analyst at Pali International Ltd. in London.

About 10.7 million Game Group shares changed hands today, about three times the daily average for the past six months.

Morrison is selling top-selling games for Nintendo Co.'s Wii for 15 pounds ($26.37), and titles for Sony Corp.'s PlayStation 3 and Microsoft Corp.'s Xbox 360 at 25 pounds each, a spokeswoman said. The offer finishes on Sept. 14. Woolworths last week cut the price of the Wii console to 159.99 pounds from 179.99 pounds, spokesman Daniel Himsworth said. That promotion ended on Sept. 7.

``We think the opening salvo in what could turn out to be a very bloody price war was fired yesterday by Morrisons,'' Altium Securities analyst David O'Brien said in a note published yesterday. ``Game has a price promise and as a result will be forced to match the levels offered by the food retailer.''

Game in July said sales growth accelerated in the second quarter as new releases including Nintendo's ``Wii Fit'' and ``Grand Theft Auto IV'' boosted revenue. First-half pretax profit will surge to at least 33 million pounds from 2.7 million pounds a year before, it said at the time.

The retailer is scheduled to report earnings for the 26 weeks ended July 26 on Sept. 30.

To contact the reporter on this story: Paul Jarvis in London at pjarvis@bloomberg.net.

Last Updated: September 10, 2008 11:50 EDT