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JJB gets extra time to tackle debt rejig
Simon English17.03.09
JJB Sports got another lifeline today after agreeing a further standstill agreement with banks on the repayment of its debts.
The retailer now has until a week today to rejig its finances, which should become easier once it concludes the deal to sell its health clubs arm for perhaps £60 million to £70 million.
Founder Dave Whelan, who owns Wigan Athletic, and former chief executive Tom Knight are in a tussle to take control of the gyms, with Whelan the likely winner.
The proceeds of the sale will pay down debts of about £60 million, which are owed to Kaupthing and HBOS.
The deal is expected to close within days, although investors will get nervous if it drags on much longer.
JJB has had a miserable year, suspending chief executive Chris Ronnie over a share sale probe and bringing in former Next boss Sir David Jones to rescue the company.
JJB confirmed today that it is considering entering a company voluntary arrangement, which would allow it to restructure with the support of its banks.
