Sports Direct set to snap up 60 JJB stores

 
City A.M. Reporter
THE break-up of loss-making and debt-laden British sporting goods retailer JJB Sports is set to begin with market leader Sports Direct yesterday sealing a deal to buy 60 of its stores.

JJB, based in Wigan, said on Monday it was close to appointing KPMG as administrators to sell its assets and brands after failing to receive an offer for the entire company, which trades from about 180 stores and employs about 4,000.

A source said Sports Direct, controlled by Newcastle United soccer club owner Mike Ashley, will pay about £30m for the 60 stores and their stock and will look to safeguard the jobs of 1,000-1,500 JJB employees.

Sports Direct, which owns Sports Direct.com and Lillywhites stores as well as brands including Slazenger, Dunlop and Lonsdale, will take 20 JJB stores immediately, with the balance of 40 stores held separately as their purchase will be subject to approval from Britain's Office of Fair Trading.

The firm’s shareholders will not get any return on their investment. JJB shares, which were valued at about 300p three years ago, were suspended at 0.4p on Monday.

It is understood other interested parties in JJB stores include US shareholder Dicks Sporting Goods and Irish firm Stafford Group. Sports Direct declined to comment. A spokeswoman for KPMG could not confirm a deal had been signed.

Shares in the group, over two thirds of which are owned by Ashley, have risen 56 per cent over the last 12 months.