JJB Sports has formally put itself up for sale following continued poor trading at the embattled sportswear retailer.
The decision follows acknowledgement by JJB that it would be unable to raise sufficient funds to go ahead with turnaround plans, and so dire is the retailer’s situation that its shares may be worthless.
JJB Sports has hired adviser KPMG to oversee the sale process, but the retailer warned that there is no certainty an offer will be made.
The retailer has suffered for several years at the hands of arch-rival Sports Direct, and the decision to seek a sale follows several attempts to restructure, including two CVAs.
JJB also disclosed a further sales slide. In the six weeks to August 26, like-for-likes declined by 3.3% while like-for-like cash margin crashed by 9.5%. The retailer is carrying net bank debt of £16.5m, has another £18.75m of outstanding convertable loan notes and has drawn down £1.1m under a trade loan facility.
The retailer said: “Given the level of current debt within the company, there can be no assurance that any proposal or offer that may be made would attribute value to the ordinary shares.”
Turnaround specialist Bob Corliss will still become chairman from September 1 and will steer the sale process.