AROUND 2,200 staff - including 91 in the North East - were made redundant last night after administrators closed 133 stores and agreed to sell 20 remaining outlets to Mike Ashley's Sports Direct International.
The Newcastle United owner’s company bought the stores, the brand and its website for £23.8m in a deal that will protect 550 jobs in the UK, including its warehouse.
But the agreement is a worse-than-expected outcome for JJB staff as Sports Direct was reportedly hoping to safeguard up to 1,500 jobs and buy up to 60 stores.
David McCorquodale, corporate finance partner at KPMG, who led the sales process, said the level of cash and further operational restructuring required to rescue a more substantial part of the business was too much risk for most interested parties.
None of the seven JJB Sports stores in the North East have been saved. Shops at the Metrocentre in Gateshead, Sunderland, South Shields, Durham, Hartlepool, Stockton and Darlington will all close with the loss of 91 jobs.
JJB’s collapse will serve as another blow to the high street after recent high-profile casualties including video games retailer Game Group, fashion chain Peacocks, outdoor specialist Blacks Leisure and Clinton Cards.
The JJB name will vanish as Sports Direct intends to convert all stores as part of the deal, in which it also acquired all of the company’s stock and the Slazenger Golf brand.
Brian Green, David Costley-Wood and Richard Fleming, partners of KPMG LLP, were appointed as administrators. KPMG said the net proceeds of the sale will be used to repay the company’s outstanding debt to its lender and other secured creditors, and it confirmed shareholders’ interests would be wiped out.
Staff made redundant as a result of store closures have had arrears of wages and holiday entitlements paid in full.