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Case Study 2: JJB Sports plc

Part of the Palgrave Studies in Governance, Leadership and Responsibility book series (PSGLR)

Abstract

JJB Sports plc was a large public company that went through two CVAs with different outcomes. The company was ultimately placed into administration and was dissolved in 2016. This case study focuses on the CVAs. It demonstrates the use of debt financing to resolve cash flow problems and the effect this has on lenders’ bargaining power with directors. It also demonstrates how companies can use intercompany debt as an unsecured claim to influence the results of creditor voting in favour of a CVA. The discussion of the informal rescue process covers use of all options including board change, asset sale, share issue and debt financing. The company’s entry into administration in 2012 illustrates the implied superior position of secured creditors’ interests outside the scope of the CVA.

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  • DOI: 10.1007/978-3-319-77110-6_8
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Parkinson, M.M. (2018). Case Study 2: JJB Sports plc. In: Corporate Governance in Transition. Palgrave Studies in Governance, Leadership and Responsibility. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-77110-6_8

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