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JJB Sports looking to raise additional capital

Troubled sports retailer JJB Sports is rumoured to be looking at a number of fundraising activities to increase the company's working capital. This is a company which recently agreed a company voluntary arrangement (CVA) during which it creditors agreed to accept reduced payments in lieu of company debt. While this had appeared to secure the short to medium term future of the group there are growing concerns about the need for additional working capital.

However, at first glance it does not look as though the requirement for additional working capital is as serious as the company's recent issues. The directors of JJB Sports are said to be looking at a number of options which include selling off non-core assets, extending current loan agreements beyond 2010 and also offering new shares to shareholders. Either one of these options, or a mixture, should be enough to see the company through the worst of the UK recession at which point it can hopefully rebase and rebuild for the future.

While the likes of JJB Sports have taken much of the headlines in the UK retailing sector the company is not the only operation struggling financially and in need of extra cash. Even though many believe the UK recession is over the worst there are still many companies potentially in serious financial trouble that will require assistance at some stage.

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