Beleaguered retailer JJB Sports has earned breathing space from its creditors after selling its fitness clubs business to company founder Dave Whelan for GBP83.4m (US$121.6m).

The sell-off is one of a series of measures "intended to address the group's current financial difficulties", JJB said - including the extension of standstill arrangements with lenders and the dismissal of former chief executive Chris Ronnie.

The company said the proceeds from the sale would initially reduce its borrowings, but would ultimately be used to fund short-term working capital.

It said it would pay all March quarterly rents in full, and would propose a company voluntary arrangement (CVA) - a measure designed to satisfy the claims of landlords of the company's closed stores, as well as allowing monthly rental payments for those stores still trading.

As a result, standstill arrangements with the company's lenders - Barclays, Lloyds and Kaupthing - would continue until the CVA was approved and took effect.

The current standstill deal had expired earlier this week.

And the company would secure a short-term loan of GBP25m from Barclays, plus a medium-term GBP25m working capital facility with Lloyds, again dependent on the acceptance of the CVA.

JJB also said it had dismissed former chief executive Chris Ronnie, who was suspended in January pending an investigation into the disposal of his stake in the company.

Finance director David Madeley would resign, JJB added, with Richard Manning taking over as legal director and company secretary.

"In announcing our series of measures today, we have taken the first step in securing JJB's long-term future after months of speculation," said Sir David Jones, executive chairman.

"We have worked very hard with our advisers and lending banks to propose a robust, solvent restructuring of the group that we believe is in the best interests of all of our stakeholders."