JD Sports Fashion is thought to be in talks with JJB Sports to buy the Qube and Original Shoe Company chains from its struggling rival.
JJB was looking to sell its non-core assets to maximise shareholder value, the retailer said on Tuesday.
It is understood that JD Sports Fashion made an approach to buy the fashion arm of JJB. The sale could be worth£20 million for JJB, observers believe.
JJB, run by Chris Ronnie, has been severely hit by the consumer downturn. Bailiffs have been called to stores over unpaid rents and credit insurance was pulled from JJB suppliers by insurer Coface.
The retailer may also be affected by the current Icelandic turmoil. Ronnie’s 29 per cent stake is backed by Icelandic investors, and a bridging loan of£20 million was very recently agreed with Kaupthing.
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