JJB Sports has extended its arrangements with its lenders - Barclays, HBOS and Kaupthing - allowing it to delay making payments to them without any extra fees, in view of the negotiations still going on over the sale of its profitable fitness clubs. The arrangements, which were to expire at midnight one week ago, have been extended to tomorrow, March 24.
Quarterly rent is due to the landlords of JJB stores on March 25. This is also the date given by some sources for the likely agreement for the sale of the fitness clubs to Dave Whelan, the founder of the company, who sold his shares in JJB in June 2007 to Chris Ronnie, recently suspended as JJB’s chief executive, and other investors.
Whelan has been rumored to be will to pay £70 million (€74.6m-$101.3m) for JJB’s fitness clubs, enough to pay back outstanding loans of £60 million (€63.9m-$86.8m). However Mike Ashley, founder and main shareholder of Sports Direct International, has been reported as trying to derail the gym deal and to be maneuvering to buy some of JJB’s stores on the cheap.
The new management of JJB is also said to be considering alternative measures including a “company voluntary agreement,” whereby JJB’s creditors would agree to have debts repaid with future profits. JJB is also said to be looking at the sale of 30 or so stores if it cannot negotiate more favorable rents.
