JJB Sports, the sports retailer, has posted detailed plans of its proposed Company Voluntary Arrangement today.
The CVA details, first revealed in Property Week on Friday, were posted out to all JJB’s unsecured creditors last night.
The CVA concerns 140 closed retail stores and proposes to temporarily vary the terms of the leases of around 250 open retail stores to allow monthly rent payments.
The proposals, which need to be approved by more than 75% by value of its creditors, requests that landlords of the 140 closed stores will take back the leases from JJB of the closed stores in return for two payments. The landlords will be able to make a claim against a total fund of £10m. Payments from the fund will be made in two instalments, in October and January, which will, on average, cover the rental outgoings for landlords of these closed stores for around six months. Many of JJB’s landlords own both closed and open JJB stores.
JJB has also agreed a short term £25m loan with Barclays and a medium term £25m revolving facility with Bank of Scotland, a subsidiary of Lloyds Banking Group, only available if the CVA Proposal is approved and becomes effective.
Commenting on the CVA Proposal and the new financing arrangements, Sir David Jones, executive chairman, said: 'This announcement details the continuing steps we are taking to implement the strategy necessary to secure JJB's long term future.
‘We are very encouraged by the initial feedback from these discussions with key stakeholders and hope their continued support will ultimately allow us to focus on realising the full potential of the group's core sports retail business.