JJB Sports remains in ‘constructive discussions’ with its debt providers, after its share price plummeted this week.
JJB Sports said in a statement that it noted the recent fall in its share price and that its debt providers Barclays, HBOS and Kaupthing, remained supportive of the business.
JJB Sports said it would update the market on trading and related issues on December 10, as previously planned.
The sportswear retailer added that discussions were ongoing in relation to the sale of JJB’s fitness club business and it other non-core assets, which include Original Shoe Co and footwear chain Qube.
JJB Sports’ share price has taken a battering since the summer. It posted losses of £9.7 million for the 26 weeks to July 27. The collapse of the Icelandic banks also raised questions over JJB’s future - Icelandic investment firm Exista is a large shareholder in the business. JJB suppliers were also unable to get credit insurance on its orders and landlords sent bailiffs to some of JJB Sports’ stores after it sent out post-dated rent cheques.
Earlier this week the Office of Fair Trading said it was investigating whether JJB Sports’ and its direct rival Sports Direct were considering a merger. Sports Direct took a 4.7% stake in JJB Sports last month and holds an additional 12%-14% stake via contracts for difference. The OFT announcement sent JJB’s shares down a further 20% as concerns mounted in the City that Sports Direct would be forced to sell its shareholding.
JD Sports Fashion also acquired a 10% stake in JJB Sports last week and has been linked to a bid for the firm.