JJB shares up 30% after gym sell-off

Shares in ailing British sportswear chain JJB Sports jumped today as the firm mapped out a new direction for the business after staving off collapse with the £83.5m (€89.9m) sale of its health clubs.

Wigan-based JJB, which sold the gyms to founder Dave Whelan yesterday, will relaunch its retail chain with a new range of sports equipment and clothing under the “Serious about Sport” banner.

Shares soared almost 30% after the firm was also granted £50m (€53.8m) in working capital from lenders to keep it in business.

But the support will be dependent on JJB striking a deal with landlords under a company voluntary arrangement.

It will look to reduce an estimated annual rental bill of around £15m (€16.1m) for 140 stores closed last year, while temporarily switching to monthly payments for its 250 open outlets.

Executive chairman David Jones said: “We have taken the first step in securing JJB’s long-term future after months of speculation.”