Page last updated at 06:24 GMT, Friday, 9 October 2009 07:24 UK

JJB Sports in 100m rights issue

JJB Sports sign
JJB is under investigation by the SFO

JJB Sports is looking to raise £100m by selling new shares as it tries to grow its business, which narrowly avoided going into administration this year.

Observers say it will use the rights issue to revamp shops and buy stock.

Wigan-based JJB has said it wants to focus on sportswear rather than fashion, and to avoid being seen as a discounter like rival Sports Direct.

Full details have not been announced, but shares are expected to be sold at a discount to Thursday's market price.

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It has been reported that the firm had been looking to raise less that £100m, but that it upped its target after its main shareholders were enthusiastic about the plan.

JJB made a £42.9m loss for the six months to July, compared with a deficit of £14.8m in the same period a year ago.

When it reported the results it told the City it had been close to going into administration and had only been saved after striking a company voluntary arrangement (CVA) with its landlords.

CVAs are an agreement between a company and its creditors, aimed at allowing firms time to address problems and then repay some or all of what is owed within an agreed time frame.

JJB, together with Sports Direct International, is being investigated by the Serious Fraud Office (SFO) over a suspected sports retail cartel.

The SFO's investigation was focused on individuals, not the company, JJB has said.

The company is just the latest to launch a share sale in recent weeks.

Ladbrokes, Yell and housebuilders Barratt and Redrow are among those going to shareholders for cash.



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SEE ALSO
JJB Sports sees losses increase
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Sportwear chains face fraud probe
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JJB shares up on Bill Gates' move
16 Jul 09 |  Business
JJB looks to raise extra capital
05 Jul 09 |  Business
'Bad publicity' hits JJB's sales
21 May 09 |  Business
JJB Sports is thrown a lifeline
27 Apr 09 |  Business

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