Fears were growing over the future of JJB Sports as Retail Week went to press and the expiry of a standstill extension agreement with lenders loomed.
Since the new management team of executive chairman Sir David Jones and executive director Peter Williams was installed at JJB in January, banks have twice granted the retailer breathing space – on the most recent occasion, to allow the disposal of its fitness clubs arm. The agreement lasts until Monday.
It was unclear as Retail Week went to press whether a sale of the gyms arm could be completed in time and, if not, whether another extension would be agreed.
Several sources feared that if a sale of the clubs was not concluded quickly, JJB could be placed into a pre-pack administration next week.
Jones would not comment, other than to say that JJB was still “in discussions” with the banks.
One route the business may have considered, sources say, is a company voluntary arrangement.
That option was not successful when attempted by footwear retailer Stylo, but JJB’s higher proportion of out-of-town landlords may be more open to the idea. Out-of-town landlords have suffered a large number of voids as a result of retail collapses.
On Monday JJB confirmed it has received several second-round expressions of interest in its gyms. Interested parties are understood to include private equity group Rutland Partners, JJB founder Dave Whelan and Fitness First, but at£41m the highest bid is thought to be significantly lower than hoped for.
JJB’s lifestyle arm, comprising Qube and Original Shoe Company, was put into administration in February and no buyer has yet been found. If a buyer does not emerge, administrator KPMG will sell off remaining stock and may have to close more of the 30 shops still trading.