Loan extension costs JJB £8.3m in fees

BELEAGUERED sportswear retailer JJB has announced that it will have to pay £8.3m in fees on an arranagement made with its lenders in December.

The company struck the temporary deal with lenders Kaupthing, Barclays and HBOS to avoid having to pay back a £20m bridging loan to Kaupthing by its due date of December 14, and to have continued access to the Barclays and HBOS facilities to the end of January 2009.

Instead it repaid £20m pro-rata across the three banks – it had also owed Barclays £60m and HBOS £15m.

It said payment of the fees to Kaupthing, Barclays and HBOS was expected in February and April.

In a statement to the stock market JJB added that as well as the fees, it has agreed a margin uplift for both the Barclays and HBOS facilities to bring them in line with the terms of the Kaupthing facility.

JJB said: “Barclays, HBOS and Kaupthing remain supportive of the company under the leadership of the new executive chairman, Sir David Jones.

“The lenders and the company are in constructive discussions to extend the term of the standstill agreement and the lenders will be considering the provision of medium term facilities to support the business.”