Shares surged in JJB Sports yesterday after speculation that US sports footwear giant Footlocker could make a play for the sportswear retailer.

Shares rose 1.25p or 8% yesterday to 17p after City rumours suggested that New York-based Footlocker was considering a bid of up to 30p a share for JJB Sports.

Footlocker is looking to expand in Europe and the UK.

Loss-making JJB, which has 250 stores, avoided administration six months ago by selling its fitness clubs for £83m and completing a debt restructuring and £100m fundraising.

Last week, new chief executive Keith Jones reported a £68.5m annual loss but said that trading had improved and that a recovery in operational performance is under way. He said he expected the group to make a profit in three years.