Member Article

JJB shares worthless as business is sold on

JJB Sports has been put up for sale, resulting in a sharp drop in share prices after the firm admitted it was nearly worthless.

Share prices fell to 0.7 pence on Thursday morning after the sports retailer put itself up for sale.

Discussions with partners over the raising of capital and restructuring resulted in business leaders abandoning the company.

JJB said: “The Directors do not believe that the Company will be able to raise the level of funds required to implement the turnaround.

“As a result, the Board has decided to conduct a formal sale process of the Company and now wishes to invite offers to support further investment in the Company, which may result in a sale of the Company or its assets.”

The formal sale of the British high-street retailer comes as net bank debt stands at £16.5m and additional loan notes of £18.75m are outstanding.

JJB Sports admitted that there was no guarantee of a purchaser answering the sale of the firm, which will be carried out through adviser KPMG.

An announcement in July said the poor condition of the business was down to poor weather conditions this summer and low demand for football strips.

The retailer was also hurt by the withdrawal of £20m of investment from American sports and ammunitions giant Dick’s Sporting Goods, as reported on Bdaily.

The Chairman appointed early in July, Bob Corliss, will take on the role at the weekend and will take JJB through the sale process.

This was posted in Bdaily's Members' News section by Miranda Dobson .