UK: Fitness clubs sale gives JJB breathing space
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."
Help test our new apparel sourcing tool.
The next few days will be the most important in the history of ailing retailer JJB Sports. If the company’s creditors accept the terms of a company voluntary arrangement (CVA), JJB will live to fight ...
Sporting goods retailer JJB Sports has announced spiralling losses for the first half of the year, but remains confident that restructuring moves will eventually pay off....
UK sporting goods chains Sports Direct International and JJB Sports both received visits from investigators today (10 September), probing a suspected agreement to dampen competition in the sports reta...
The UK's Office of Fair Trading (OFT) has referred retailer Sports Direct International's acquisition of 31 stores from JJB Sports to the Competition Commission....
Forget Coronation Street, the UK's North West is home to a new soap opera with a plot far more gripping than anything on TV....
A war of words has broken out between leading UK sportswear chains JJB Sports and Sports Direct International....
Troubled sportswear retailer JJB Sports today (24 July) said a 40% drop in first-half sales was in line with expectations, but that it expects performance to improve by the end of the year....
Here is a roundup of the top five most-read stories on just-style this week. Click on each headline for the full story....
- Unlocks for the future fashion sourcing landscape
- EU eyes mandatory due diligence for apparel supply
- Geo-political uncertainty and how to survive it
- What TTIP might mean for US, EU textiles & apparel
- Where next for Corporate Human Rights Benchmark?
- Li & Fung forms supply chain partnership with PVH
- US Q4 in brief – Finish Line, Oxford Industries
- Sears has "substantial doubt" of future
- World Bank commits $57bn to sub-Saharan Africa
- Target unveils "ambitious" store re-design plans
- Central and East Europe Report Package
- Central America strategic sourcing review - a focus on Guatemala, El Salvador and Honduras
- Southeast Asia strategic sourcing review – a focus on Cambodia, Vietnam and Myanmar
- When Things Go Wrong - A Practical Guide to Managing Common Problems in Apparel Sourcing
- Outdoor performance apparel 2016: A broader perspective