Ashley to raise loan issue at JJB AGM

JJB Sports’ chairman Sir David Jones looks set to come under pressure from controversial rival Mike Ashley at tomorrow’s annual meeting.

According to reports, the retail grandee, who is leading the Wigan-based group’s recovery, will face questions over a £1.5m loan he received from Mr Ashley, the founder of JJB’s rival Sports Direct.

Mr Ashley will either attend the meeting in Wigan himself or send a representative to put pressure on Sir David over details of how the loan – which has since been repaid – was arranged.

JJB has acknowledged the existence of the short-term loan but said the deal had been struck before Sir David joined JJB’s board and so considers the matter closed.

Last weekend began to increase the pressure on Sir David, by releasing a copy of a letter saying that the loan had been arranged after Sir David joined JJB’s board.

Sir David is to face a vote on his re-election to the board at the meeting. The retailer, which narrowly avoided insolvency thanks to a Company Voluntary Arrangement and the £80m sale of its gyms business, is currently looking at strengthening its balance sheet with a £50m rights issue.

Despite the row over the loan, Sir David looks to have the support of some major investors.

JJB’s two largest shareholders, Harris Associates and Crystal Amber Asset Management, which each hold 14% appear to be backing the former boss of Next.

David Herro, chief investment officer at Harris Associates, said he had voted by proxy in favour of Sir David’s re-election to the board.

“He [Mike Ashley] tends to make a circus out of everything and it’s just getting a bit tiring,” he told a national newspaper.

“I am more concerned about this company stabilising and at this stage establishing its management team and its retail presence. That has nothing to do with the loan.”