Beleaguered high street retailer JJB is to enter into company voluntary arrangements (CVA) with around 140 landlords over its closed stores.
It said it also wanted to ‘temporarily vary’ the terms of the leases of its 250 still open stores so it can pay rent monthly.
All March quarterly rents will be paid in full, it said, adding that the standstill arrangements with its lenders - Barclays, Lloyds and Kaupthing Singer & Friedlander - have been extended until the CVA proposal has been approved and becomes effective.
JJB has also sold its Fitness Clubs business back to founder David Whelan for £83.4m.
In a statement issued to the stock exchange today, JJB said the sale would ‘initially reduce the company's borrowings under its working capital facilities, but will ultimately be used to fund the company's short term working capital requirements.’
Should the CVA go through, JJB would enter into new funding arrangements including a short term £25m loan with Barclays and a medium term £25m working capital facility with Lloyds, together with a possible issue of warrants to Lloyds in connection with their continuing support of the business, it said.
Sir David Jones, JJB executive chairman said: 'In announcing our series of measures today, we have taken the first step in securing JJB's long term future after months of speculation.
‘In addition to the continued support of our lending banks, our proposals require the approval of our unsecured creditors and our shareholders. Their support of our CVA proposal will ultimately allow us to focus on realising the full potential of the Company's core sports retail business.'
JJB has also changed its board.
Former chief executive Christopher Ronnie has been dismissed, and finance director David Madeley is to resign. Richard Manning has joined as legal director and company secretary.