Key investors back JJB turnaround

Ailing retailer JJB Sports today said it had secured key support from its bank and major shareholders as it battles to stave off administration.

The loss-making retailer said investors including the Bill and Melinda Gates Foundation had agreed to back its latest £65m (€75m) fundraising, while Bank of Scotland is also prepared to extend £25m (€28m) in working capital.

However, the support is conditional on a key vote next week when JJB will ask landlords and shareholders to back controversial proposals to close up to 89 unprofitable stores over the next two years and alter rental payments.

JJB, which today disclosed further sales declines in 2011, has unveiled a new business plan that it hopes will convince creditors and investors to back its plans to build a long-term future.

The turnaround plan involves cutting costs and increasing sales through investing in staff training, upgrading some of its 160 viable stores and improving its ranges.

It has devised plans for three types of stores which will help to tailor its stores to suit their location and will stock more exclusive ranges such as Slazenger Golf and Run 365.

But the retailer also revealed a 13.5% like-for-like sales decline between January 24 and March 13, although it said the figures were in line with internal expectations.