Stricken retailer JJB Sports was saved from administration today after landlords backed its second rescue deal in as many years.
The sportswear group received critical support for its survival plans that will see it close 43 unprofitable stores, place a further 46 under review and move to monthly rental payments.
More than 75% of JJB's creditors - the majority of which are landlords - and over 50% of shareholders approved a controversial company voluntary arrangement (CVA), which is an alternative to administration.
The move offers hope for the future of the battered chain and its 6,100 staff.
Mike McTighe, chairman of JJB, said the vote demonstrates the "solid support" for its turnaround.
He added: "We would like to thank our landlords and creditors who have supported the company in this crucial vote. As a result, the management and the vast majority of our colleagues now have the opportunity to work alongside all stakeholders as we continue to achieve essential milestones in our turnaround."
Landlords have forfeited a significant amount in lost rent as part of the CVA. They are likely to receive between 25p and 29.2p in every pound they are owed, although this compares with just 1p if the company falls into administration.
Under terms of the deal, Wigan-based JJB offered landlords of stores which are shut a sweetener of up to £7.5 million in cash or shares in two years, depending on its performance.
But the British Property Federation (BPF), which represents landlords, warned today's vote should not be seen as a "green light" for retailers to dump failing stores.
Liz Peace, chief executive of the BPF, said: "Landlords treat each CVA on its merits and JJB is a business undergoing significant changes.
"This is not an opportunistic dumping of stores, rather a genuine attempt at rescuing the business, and should not be seen as a green light for other retailers to restructure their portfolios via a CVA at the expense of both landlords and their competitors."
Shares in the retailer leapt higher as today's CVA approval brought JJB back from the brink.
Hopes for the CVA were boosted in recent days when two of its biggest landlords, Peel Holdings and Hammerson, said they would vote in favour of the scheme.
Its chances of success also increased when it emerged that JJB's largest creditor is also a subsidiary of the group.
A company called Blane Leisure is a wholly-owned subsidiary of JJB, which signs up the group's store leases under its own name. Blane is said to be owed £150 million by JJB, putting it at the top of the creditor chain.
JJB has staked its future on winning approval for the CVA after takeover talks with rival JD Sports recently ended.
JD abandoned its pursuit earlier this month after claiming JJB snubbed its requests for information, although JJB countered that the proposal was "highly conditional and lacking sufficient certainty".
As well as the CVA deal, JJB is also turning to shareholders to raise another £65 million in its fight for survival.
It recently said it had secured key support from shareholders including the Bill and Melinda Gates Foundation for the fundraising, while Bank of Scotland is also prepared to extend £25 million in working capital.
JJB will now plough on with revival plans, which involve cutting costs and increasing sales through investing in staff training, upgrading some of its 160 viable stores and improving its ranges.
It has devised plans for three types of stores which will help to tailor its shops to suit their location and will stock more exclusive ranges such as Slazenger Golf and Run 365.
Retail analyst Nick Bubb, of Arden Partners, said today's reprieve will be seen as good news for competition in the sportswear sector.
He said: "The big sports suppliers want JJB to survive to avoid the industry being dominated by Sports Direct International, but it is not clear that consumers do, given how badly the business is trading and the huge losses being incurred."
JJB was saved from going into administration in 2009 after it secured its first CVA, when it ditched 140 stores and arranged to pay rent on a monthly basis at its 250 remaining outlets for a year.
However, the firm has struggled to compete with buoyant rivals JD Sports and Sports Direct International, while the demand for cut-price offers has squeezed its margins.
Pre-tax losses more than trebled to £68.5 million in 2010 and like-for-like sales fell by 15.7% in the group's recent Christmas trading period.