JJB rights issue still on despite Jones rumours

JJB Sports was meeting with shareholders to shore up support for its £100 million fund-raiser after rumours derailed it last Friday.

Shares in the struggling sportswear retailer rose ¾p to 33¾p as the company said it hopes to press ahead with the rights issue "early this week".

It was forced to postpone the cash call on Friday as rumours circulated about executive chairman Sir David Jones, giving major investors — believed to include Schroders and Tosca Fund — cold feet.

JJB said today allegations that illicit payments had been made to Jones were "totally unfounded".

The company last night handed a dossier to City watchdog the Financial Services Authority outlining the "pernicious" allegations which it believes were intended to sink the rights issue.

The board said it remains "fully supportive" of Sir David after its own investigation into the rumours.

The JJB boss has already provoked controversy after it was revealed he received a £1.5 million loan from sportswear rival Mike Ashley two years ago.

JJB also said the share issue has received strong support, being more than three times oversubscribed.

The company said it initially put off the rights issue because of a technical issue which was resolved on Friday morning, before the rumours about Sir David surfaced.