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BPF welcomes JJB clawback
British Property Federation welcomes rescue plan giving landlords share of JJB Sports’ future profits
The British Property Federation (BPF) has welcomes JJB Sport’s plan to give landlords a share of its future profits should its Company Voluntary Agreement (CVA) be accepted.
JJB Sports’ CVA, if ratified by creditors and shareholders at a meeting on the 22 March, will see 43 stores close before April 2014, 2012 with a further 46 under review until the same date in 2013.
The clawback proposal offers landlords ‘an additional payment of between £2.5m and £7.5m to compromised landlords that is linked to the market performance of JJB Sports and is payable on April 24, 2013’.
JJB Sports’ CVA will require 75 per cent of creditors to be in agreement or it will not be passed. This follows JJB Sports first CVA in April 2008 which resulted in 140 stores closing and leases renegotiated on the remaining 250 stores.
Liz Peace, BPF chief executive, said: “JJB Sports’ offer to give landlords a share of its future profits shows it has listened to our concerns, but whether the sums proposed are sufficient to sway landlords’ votes remains to be seen.
“Landlords and their shareholders, many of whom invest on behalf of pensioners, lose out through every CVA. These ‘clawback’ clauses should therefore be included in almost all CVAs as a matter of course.
“However, it must be remembered that this is JJB Sports’ second bite of the cherry. JJB Sports disposed of 140 stores through its last CVA two years ago, and so any creditor will be seeking reassurance that this is a lasting solution to the company’s problems.”
