JJB shares surge amid funding talks

JJB Sports saw a jump in its battered share price today (Getty Images)

JJB Sports saw a jump in its battered share price today after confirming it was involved in funding talks with a potential strategic partner.

The company said "constructive discussions" about raising additional financing involved other key stakeholders and its lending bank, although it did not name the parties involved.

JJB, which nearly went bust last year, issued a statement on the fundraising in the wake of speculation regarding a potential offer for the company.

The rumours and subsequent confirmation of fundraising talks caused a 35% jump in its share price to just under 14p, valuing JJB at around £40 million.

The company, which now has 195 sites after closing a number of unprofitable stores, was last year forced to secure £96.5 million in a rescue deal involving major shareholders including the Bill and Melinda Gates Foundation.

However, the sportswear retailer has already warned its recovery could take up to five years, with the scale of the turnaround set to be highlighted in forthcoming full-year results showing annual losses of £60 million.

Its problems have stemmed from stock supply issues and intense competition, including from rival Sports Direct International.

JJB said today: "The company confirms that it has in recent weeks held discussions with its lending bank and a number of potential strategic partners and investors about raising additional financing for the company.

"Constructive discussions continue with the company's lending bank and one of the potential strategic partners and have been widened to include other key stakeholders.

"There is no certainty that these discussions will result in the company reaching agreement for the provision of additional financing."

PA