Business

JJB Sports announces £31.5m fundraising

JJB Sports store
Image caption JJB has struggled with weak sales and issued a profit warning in November

JJB Sports has announced plans to raise £31.5m from shareholders, three weeks after warning it was likely to breach the terms of a key banking agreement.

The retailer said it was raising funds from major shareholders including Crystal Amber and the Bill & Melinda Gates Foundation Trust.

It added that its lender, Bank of Scotland, had agreed to waive tests that had been due in January.

Sales in the six weeks to 19 December were down 15.7% on last year, JJB said.

Bad weather conditions had continued into the pre-Christmas period and had "significantly affected" sales, the company said.

Shares in the sports retailer rose 28% after the announcement to close at 5.3p.

JJB also announced that chairman John Clare would step down with immediate effect.

He will be replaced by Mike McTighe, a former Cable & Wireless executive.

On 2 December, the retailer, which struggled during the downturn, warned it was likely to breach "certain financial covenants" in a £25m loan facility provided by its bank after worse-than-expected sales in recent weeks.

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