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JJB – stick or twist ?


boss

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Today’s the day that the future of JJB may transform from being utterly unknown, to simply being as clear as mud.

It’s quarterly rent day today, when JJB and most others have to pay their landlords' rent in advance for the next 3 months. JJB’s banks have given the company extended deadline after extended deadline to repay the millions owed to them. The latest deadline expired yesterday, quite deliberately the day before the rent is due.

JJB’s recent history since my last epistle is a trail of bloodshed, incompetence, new hope, intrigue, private jets, CEO suspension, PR leaks, and corporate backstabbing. It would take me all day, really it would ....... Suffice to say that Sir David Jones (he of Next fame) is in charge, he has made massive changes already, however the banks are still growling, the vultures are circling, but JJB might survive. For now.

To do so, they need to sell their profitable gym division – just over 50 JJB Fitness gyms (together with the attached JJB stores), most of which are in England. Dave Whelan, JJB founder, is the preferred bidder and looks likely to pay something like £70m; the name would be changed to DW Sports/DW Fitness/or some combination. www.dwsportsfitness.com was registered a few weeks ago by the former JJB Marketing associate director who left in February! Wigan’s JJB stadium would also change its name accordingly.

In the meantime, Mike Ashley (Sports Division and Newcastle United supremo) is trying to scupper the deal, writing to JJB’s landlords, the LSE, Uncle Tom Cobley and all. He is a bad man. A very bad man. And he hates Dave Whelan. He wants Whelan’s deal to fail, JJB put into administration, and pick from the carcass.

There will be an announcement today. It will probably be that Dave Whelan has bought the gyms and stores, the banks have got their money, the rents have been paid, and JJB continues. But it just might be that JJB have gone into administration, though there is probably too much at stake, financially and politically, for that to happen today.

So if things go to plan today, why does that leave JJB’s future as clear as mud ? Well, I did say that the gym division was profitable, very profitable. Together with other forced disposals of profitable stores, that leaves JJB a rump of what is was a year ago, and a loss-making rump at that. Sir David Jones will have a massive task in turning it around in the months and years ahead and save it from eventually going belly up. Can he do it ? If anyone can, he can – he has done an excellent clear-out job in the few months since his appointment. Will he do it ? Depends entirely on future spending by customers. And on whether a rumoured Company Voluntary Arrangement is successful in ridding JJB of a further 30 unprofitable stores.

So it is down to the wire. In the next few hours there will be much happening, whether it’s a sale to Dave Whelan or Administration. And if Whelan gets his way, who knows whether, and for how long, JJB can subsequently survive. Either way, desperate times.

Mud, mud, glorious mud.

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I would pitch the above as a sypnopsis for a future movie, a Greek tragedy in the Shakespear style. To JJB, or not to JJB would be an oscar winning blockbuster.

Of course, Focus Groups will demand a bit part for a perspiring snake oil salesman, someone we can all hate and blame. I don't know why, but former catalogue model and Gilmorehill drop out, Martin Bain comes immediately to mind. Will Martin subject himself to the rigours of the casting couch?

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I would pitch the above as a sypnopsis for a future movie, a Greek tragedy in the Shakespear style. To JJB, or not to JJB would be an oscar winning blockbuster.

Of course, Focus Groups will demand a bit part for a perspiring snake oil salesman, someone we can all hate and blame. I don't know why, but former catalogue model and Gilmorehill drop out, Martin Bain comes immediately to mind. Will Martin subject himself to the rigours of the casting couch?

Martin will be a character in the movie, he has asked for Brad Pitt to play him.

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I would pitch the above as a sypnopsis for a future movie, a Greek tragedy in the Shakespear style. To JJB, or not to JJB would be an oscar winning blockbuster.

Of course, Focus Groups will demand a bit part for a perspiring snake oil salesman, someone we can all hate and blame. I don't know why, but former catalogue model and Gilmorehill drop out, Martin Bain comes immediately to mind. Will Martin subject himself to the rigours of the casting couch?

Martin will be a character in the movie, he has asked for Brad Pitt to play him.

Eddie Murphy would have been better playing him, given the skin tone :pipe:

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I would pitch the above as a sypnopsis for a future movie, a Greek tragedy in the Shakespear style. To JJB, or not to JJB would be an oscar winning blockbuster.

Of course, Focus Groups will demand a bit part for a perspiring snake oil salesman, someone we can all hate and blame. I don't know why, but former catalogue model and Gilmorehill drop out, Martin Bain comes immediately to mind. Will Martin subject himself to the rigours of the casting couch?

Martin will be a character in the movie, he has asked for Brad Pitt to play him.

Eddie Murphy would have been better playing him, given the skin tone :pipe:

:clap:

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Stage 1 just announced - the DW STADIUM.

http://www.wiganlatics.co.uk/page/NewsDeta...1602350,00.html

think whelan will get it as the rumours are he turned down a 1M cash advance from a Norweigan company to sponser them for next season , and that he will be going ahead with using his own firm DW fitness or such like as the clubs new sponser.

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With the exception of kit and training wear my company could supply Rangers with every other product that the sell in thier stores, I deal with EPL clubs and championship sides at present .

Have written to Rangers informing them of this , the response was they are tied into contract with JJb , can only think SDM would get rangers some kind of compensation package or if JJB do survive Rangers still get paid year on year

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Tonight's update.

JJB will tomorrow seek to enter into a Company Voluntary Arrangement. Basically this is last chance saloon, one step away from Administration. Principally it hopes to do deals with its landlords (basically to ditch them!), mostly in respect of 140 closed stores where it is still paying rent. If this CVA works, new bank funding of £50m will be available. If the CVA doesn't work, it will go into Administration.

So far as Rangers are concerned, it SHOULD be the case that the JJB deal contains clauses that in an "insolvency event" or "entering into an arrangement with its creditors" (which a CVA is), the rights revert back to Rangers. And we get to keep the remainder of the up front £18m. I say SHOULD - the deal HAD BETTER cover this otherwise Bain imo should be sacked and the solicitors involved should be sued!

Other highlights from tonight:

Suspended CEO has now been sacked for gross misconduct.

Finance Director is (being allowed to) resign! (Did he authorise a payment to the CEO?!)

Fitness clubs and attached stores have been sold to Dave Whelan for £83m and will trade as DW Sports Fitness (gyms) and DW Sports (stores)

Recent trading at JJB has been a disaster - sales down by 22.5%, and margins down by 3.5%

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Tonight's update.

JJB will tomorrow seek to enter into a Company Voluntary Arrangement. Basically this is last chance saloon, one step away from Administration. Principally it hopes to do deals with its landlords (basically to ditch them!), mostly in respect of 140 closed stores where it is still paying rent. If this CVA works, new bank funding of £50m will be available. If the CVA doesn't work, it will go into Administration.

So far as Rangers are concerned, it SHOULD be the case that the JJB deal contains clauses that in an "insolvency event" or "entering into an arrangement with its creditors" (which a CVA is), the rights revert back to Rangers. And we get to keep the remainder of the up front £18m. I say SHOULD - the deal HAD BETTER cover this otherwise Bain imo should be sacked and the solicitors involved should be sued!

Other highlights from tonight:

Suspended CEO has now been sacked for gross misconduct.

Finance Director is (being allowed to) resign! (Did he authorise a payment to the CEO?!)

Fitness clubs and attached stores have been sold to Dave Whelan for £83m and will trade as DW Sports Fitness (gyms) and DW Sports (stores)

Recent trading at JJB has been a disaster - sales down by 22.5%, and margins down by 3.5%

140 Stores?! Are you sure, boss? that in itself is unbelievable negligence.

And as you say, if Rangers did not agree exits in event of insolvency or arrangements with creditors, then SDM's garbage about what a savvy operator he is will sound more hollow than ever. They should also have required the right to exit the deal if Rangers didn't approve of a change of control.

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mostly in respect of 140 closed stores where it is still paying rent.

140 Stores?! Are you sure, boss? that in itself is unbelievable negligence.

Yes, I'm sure!

For the last (nearly) 2 years, JJB has been run with unbelievable negligence by Chris Ronnie, the CEO who was sacked tonight for gross misconduct.

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Guest The Brown Brogue
JJB - Another fine bit of business by Bain. doh

Actually could well turn out to be a fantastic piece of business.

Assuming they do go bust, if we keep the entire original up front payment of 18 million, plus subsequent yearly payments of around 4 million we will have made around 30 million from a 3 or 4 year deal. The rights to our merchandising will also be back in our hands, or whoever we sell them to next.

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listen im no accountant

so could somebody enlighten me as to why we entered into this deal in the first place?

it just appears to be a joke !

Great deal; money upfront, annual income from sales without the expenses of rent, rates, employees wages. The current retail scene makes it an even better deal than it was when it started.

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mostly in respect of 140 closed stores where it is still paying rent.

140 Stores?! Are you sure, boss? that in itself is unbelievable negligence.

Yes, I'm sure!

For the last (nearly) 2 years, JJB has been run with unbelievable negligence by Chris Ronnie, the CEO who was sacked tonight for gross misconduct.

Say the average rent in place was £20 per sq ft and the average unoccupied store is 3,000 sq ft. Across 140 vacant stores, that rent bill is £8.4M! Even if the deals were done below that or the landlord was willing to reduce the payment a bit and you get an average of £5 per sq ft, you are still talking £2.1m a year lost. And that's on the net rent. They will be paying mall fees in some locations and operating costs in all the others.

Mind boggling mistake if that is how many stores are vacant.

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