Blacks Leisure to be sold as investors reject cash call

As well as needing about £20m in new money, Blacks is in talks with banks over its £40m of debt

Blacks Leisure, the struggling outdoor retailing group, has been forced to put itself on the market after shareholders refused to inject more cash into the business.

The company announced yesterday that it wished to "invite offers to support further investment in the group, which is most likely to involve a sale of the company or sale of one or more of the group's brands". This came after talks with shareholders about raising investment foundered.

The shares plummeted more than 50 per cent to 1.85p as the company revealed that, with debt at £36m, "there can be no assurance that any sale would attribute value to the ordinary shares of the group".

The decision to move to what company insiders called "plan B", is likely to pave the way for a pre-pack administration. The controversial insolvency procedure allows a company to collapse and then be bought quickly by a new owner, after its debts have been wiped out.

The accounting group KPMG, which was involved in an insolvency procedure that saved Blacks two years ago, has been called in to run the sale.

The company, which also owns the Millets chain, has been desperately tapping up its shareholders to raise additional cash. Analysts put the figure at about £20m, although Blacks has declined to name its exact target. The group said last month it was experiencing the worst retail environment it had ever seen.

As well as the need to raise cash, Blacks has been in negotiations with Lloyds Banking Group to renegotiate more than £40m worth of debts that fall due at the end of February.

The discussions have proved fruitless, forcing the company to put itself up for sale yesterday. One insider said: "There was good response from the shareholders, but there wasn't the support for the capital raising. The appetite wasn't there."

Sources close to the group would not be drawn on whether a pre-pack administration was imminent. One source said: "All focus is on a sale. These are strong brands and it is still a market leader."

Last year the company turned down a 62p-a-share bid from Sports Direct, owned by the Newcastle United chairman Mike Ashley. Sports Direct has a 21 per cent holding in the group.

The sources close to Blacks said the previous management team could not recommend it to shareholders as "so many conditions had been attached".

Sports Direct declined to comment on the Blacks announcement, or say whether it would return to the negotiating table with another bid for all or part of the company.

It emerged yesterday morning that Sports Direct was prepared to help Blacks with a joint venture that would share costs on warehouses, the supply chain and technology.

Voices
voicesGood for Lana Del Rey for helping kill that myth, writes Grace Dent
News
The University of California study monitored the reaction of 36 dogs
sciencePets' range of emotions revealed
Life and Style
fashion Designs are part of feminist art project by a British student
Arts and Entertainment
The nomination of 'The Wake' by Paul Kingsnorth has caused a stir
books
PROMOTED VIDEO
Arts and Entertainment
The Tour de France peloton rides over a bridge on the Grinton Moor, Yorkshire, earlier this month
film
News
Snoop Dogg pictured at The Hollywood Reporter Nominees' Night in February, 2013
people... says Snoop Dogg
News
i100
Life and Style
food + drinkZebra meat is exotic and lean - but does it taste good?
Arts and Entertainment
Residents of Derby Road in Southampton oppose filming of Channel 4 documentary Immigration Street in their community
tv
Voices
voicesSiobhan Norton on why she eventually changed her mind
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
i100
Extras
indybest
Sport
Scottish singer Susan Boyle will perform at the Commonwealth Games opening ceremony in Glasgow
commonwealth games
Arts and Entertainment
Dwayne 'The Rock' Johnson stars in Hercules
filmReview: The Rock is a muscular Davy Crockett in this preposterous film, says Geoffrey Macnab
Life and Style
tech
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

PMO Analyst - London - Banking - £350 - £400

£350 - £400 per day: Orgtel: PMO Analyst - Banking - London - £350 -£400 per d...

Cost Reporting-MI Packs-Edinburgh-Bank-£350/day

£300 - £350 per day + competitive: Orgtel: Cost Reporting Manager - MI Packs -...

Insight Analyst – Permanent – Up to £40k – North London

£35000 - £40000 Per Annum plus 23 days holiday and pension scheme: Clearwater ...

Test Lead - London - Investment Banking

£475 - £525 per day: Orgtel: Test Lead, London, Investment Banking, Technical ...

Day In a Page

Noel Fielding's 'Luxury Comedy': A land of the outright bizarre

Noel Fielding's 'Luxury Comedy'

A land of the outright bizarre
What are the worst 'Word Crimes'?

What are the worst 'Word Crimes'?

‘Weird Al’ Yankovic's latest video is an ode to good grammar. But what do The Independent’s experts think he’s missed out?
Can Secret Cinema sell 80,000 'Back to the Future' tickets?

The worst kept secret in cinema

A cult movie event aims to immerse audiences of 80,000 in ‘Back to the Future’. But has it lost its magic?
Facebook: The new hatched, matched and dispatched

The new hatched, matched and dispatched

Family events used to be marked in the personal columns. But now Facebook has usurped the ‘Births, Deaths and Marriages’ announcements
Why do we have blood types?

Are you my type?

All of us have one but probably never wondered why. Yet even now, a century after blood types were discovered, it’s a matter of debate what they’re for
Honesty box hotels: You decide how much you pay

Honesty box hotels

Five hotels in Paris now allow guests to pay only what they think their stay was worth. It seems fraught with financial risk, but the honesty policy has its benefit
Commonwealth Games 2014: Why weight of pressure rests easy on Michael Jamieson’s shoulders

Michael Jamieson: Why weight of pressure rests easy on his shoulders

The Scottish swimmer is ready for ‘the biggest race of my life’ at the Commonwealth Games
Some are reformed drug addicts. Some are single mums. All are on benefits. But now these so-called 'scroungers’ are fighting back

The 'scroungers’ fight back

The welfare claimants battling to alter stereotypes
Amazing video shows Nasa 'flame extinguishment experiment' in action

Fireballs in space

Amazing video shows Nasa's 'flame extinguishment experiment' in action
A Bible for billionaires

A Bible for billionaires

Find out why America's richest men are reading John Brookes
Paranoid parenting is on the rise - and our children are suffering because of it

Paranoid parenting is on the rise

And our children are suffering because of it
For sale: Island where the Magna Carta was sealed

Magna Carta Island goes on sale

Yours for a cool £4m
Phone hacking scandal special report: The slide into crime at the 'News of the World'

The hacker's tale: the slide into crime at the 'News of the World'

Glenn Mulcaire was jailed for six months for intercepting phone messages. James Hanning tells his story in a new book. This is an extract
We flinch, but there are degrees of paedophilia

We flinch, but there are degrees of paedophilia

Child abusers are not all the same, yet the idea of treating them differently in relation to the severity of their crimes has somehow become controversial
The truth about conspiracy theories is that some require considering

The truth about conspiracy theories is that some require considering

For instance, did Isis kill the Israeli teenagers to trigger a war, asks Patrick Cockburn