Thousands of jobs are at risk after struggling sports chain JJB launched a last-gasp survival bid.
Bosses effectively put the firm’s future in the hands of store landlords after revealing plans to shut 45 shops with the option to axe another 50.
The move – slashing its number of outlets by 40% – would drastically reduce its rent and rates bill but it relies on store owners allowing the firm to cancel long-term leases.
Insiders say without the deal – known as a company voluntary arrangement – the company could go bust.
Under the plan, 45 loss-making stores would shut in the next 12 months and another 50, which are under-performing, could go the same way within two years. That would leave JJB with 150 branches which bosses have pinned their hopes on.
JJB, which employs 6,300 staff, asked investors for £31.5million last week.
That’s on top of a £100m boost from shareholders in 2009 when a previous deal with landlords prevented it going bust. Despite a shake-up by new management – six new-format stores have opened – sales in the crucial pre-Christmas period slumped by 16%. To make matters worse, City watchdogs last month hit it with a £455,000 fine for failing to disclose the full cost of two takeovers.
The proposed CVA comes as rival JD Sports presses ahead with talks about a possible takeover.
But JD chairman Peter Cowgill told Your Money he isn’t happy. He said: “I am surprised we weren’t informed (about the CVA).”
JJB run at least six stores in the Coventry area
