THE Office of Fair Trading (OFT) is to look at Sports Direct’s purchase of 20 of JJB’s stores from administrators.

The watchdog is examining the £23.8m deal by Newcastle United owner Mike Ashley’s firm, which included buying the brand and websites, to see whether it raises any competition issues.

Sports Direct took over the shops from JJB’s administrators but a further 133 sites in the chain closed with the loss of around 2,200 jobs.

The OFT said it was “considering whether arrangements are in progress or in contemplation which, if carried into effect, will result in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom”.

It has set a deadline of next Friday for comments.

The OFT announcement comes in the same week that Sports Direct said it achieved strong summer sales, helped by the Olympics and back-to-school demand.

The group, which has nearly 400 stores and owns brands including Slazenger, Donnay and Karrimor, said total revenues jumped 18% to £402.7m in the nine weeks to September 30.

This included a rise of 17% to £344.7m in its core sports retail business, where underlying profits increased by a fifth to £142.8m.

The company is on track to hit its full-year earnings target of £270m, which will trigger its staff bonus scheme.