Retailer JJB Sports Is Calling In Administrators As Shares Drop To New Low
U.K.-based retailer JJB Sports Monday announced "it is calling in the administrators, leaving up to 4,000 workers facing possible unemployment," according to Rob Williams of the London INDEPENDENT. The retailer's shares, which had in the past been worth £10 ($16.20) a piece, were suspended, "and the company's remaining investors will see their holdings wiped out." Shares in the company have fallen 93% this year alone "after shareholders refused to put up any further cash to save the company." In just five years, the business has "gone from being one of the biggest sellers of sportswear on the high street to accruing mounting losses and high debt levels" (INDEPENDENT, 9/24). In London, Mark Wembridge noted JJB "had been in talks over the past month with potential suitors," such as Mike Ashley's Sports Direct Int'l and Irish conglomerate Stafford Group. However, JJB on Monday said that although it had received offers for parts of the business, no offer had been made for the group as a whole. Audit firm KPMG is expected to be appointed administrator in an effort to recoup some value for shareholders, who have seen JJB struggle through two company voluntary arrangements and emergency fundraising in attempts to survive. One of the "sticking points" in JJB's attempts to find a buyer was the preference of suitors to "cherry pick" the best stores and brands, rather than buy the whole company (FINANCIAL TIMES, 9/24). Also in London, Graham Ruddick noted the chain "has been squeezed by price-cutting rival" Sports Direct. JJB said that it would continue to trade through all its retail outlets pending completion of the sale and administration process (TELEGRAPH, 9/24).