Jobs in doubt at JJB Sports' lifestyle division

The future of 800 jobs was thrown into doubt today after JJB Sports said it planned to appoint administrators to its lifestyle division.

The decision affects its fashion and footwear retailer OSC, which operates 64 stores, and Qube - a footwear chain with 13 stores.

A JJB spokeswoman said the two chains employ 270 full-time staff and 530 part-time employees.

The Wigan-based retailer has been reviewing its options for the lifestyle division for some months. The two chains continued to trade at a "substantial loss", it added.

JJB warned last month that losses could reach £10m for the year as the firm struggles in "extremely difficult" trading conditions.

The lifestyle division caused the damage with an estimated £15m loss in the year to 25 January.

KPMG has been lined up as administrator to the two chains. An initial approach for the division did not lead to a deal, but management remain hopeful of a potential sale.

JJB also confirmed "a number" of potential bidders had expressed interest in its chain of fitness clubs, which have continued to deliver strong sales growth amid testing conditions at the rest of the retail business.

Shares in the company jumped as much as 70 per cent on Monday after weekend reports that it could fetch up to £55m for the chain.

The fitness club division, which operates from more than 50 sites, is said to have attracted interest from potential buyers such as JJB founder Dave Whelan, who sold his stake in JJB in 2007.

A sale would help the debt-laden firm shore up its finances and leave management free to turn around the group's high street operation.

In December, the firm agreed with lenders Barclays, HBOS and Icelandic bank Kaupthing that a £20m bridging loan from Kaupthing need not be repaid in full by mid-December. JJB instead paid out £20m to be shared between the three banks.

The firm said last month that it was in "constructive dialogue" with lenders over its medium-term financing.