LONDON BRIEFING:What was once Britain's biggest seller of sports goods is losing several million pounds a week

AMERICA’S RICHEST man is doing his bit to support JJB Sports, but the future of the struggling Wigan-based sportswear chain could lie in the hands of its angry landlords.

Major investors in the chain, including Bill Gates, the billionaire founder of Microsoft, have just stumped up £31.5 million (€37.2 million) in emergency funds, cash that will carry the loss-making JJB through the next six weeks.

That’s the good news – the bad news is that by the end of March the company will need another cash injection if it is to continue in business, possibly as much as £50 million.

The latest rescue cash-raising, shunned by small shareholders, was underwritten by JJB’s five largest investors, including the Bill Melinda Gates Foundation. As a result, the combined shareholding of JJB’s largest investors has climbed from 43 per cent to 71 per cent of the company.

Such is the state of the business, however, its only real chance of survival is a swift closure of scores of stores, which it wants to achieve via a Company Voluntary Arrangement (CVA). Under the CVA, rents on the stores earmarked for closure would be slashed and become payable monthly rather than quarterly. Reducing its rental bill is vital to the survival of the business, which is losing several million pounds a week.

So, for the second time in two years, the company’s landlords are being asked to share the pain – JJB walked away from leases on 140 shops in 2009, and its latest plans would see another 45 loss-making shops dumped on them, with up to a further 50 stores facing closure in the next two years. This would leave JJB, once Britain’s biggest sports goods chain, with a rump of around 150 stores.

Understandably, the landlords are not pleased, although the JJB management says it has had constructive discussions with many of them.

To push through the CVA, JJB needs the approval of holders of 50 per cent of its shares, which it has, as its leading investors are now sitting on 71 per cent. It also needs the support of 75 per cent of its unsecured creditors, which is where the landlords come in.

While the landlords have the power to vote down the CVA, they are in a difficult position – JJB insists that without the store closures and renegotiated rents, it will go into administration. Only a CVA will secure the long-term future of the business, insists JJB, although that is exactly what the company (albeit under different management) told them last time.

There is concern among the landlords that if they are seen to roll over on JJB’s demands for rent reductions, then other tenants will want the same. Even so, most industry observers expect the landlords to bite the bullet and agree to the CVA, particularly as JJB’s wealthy shareholders seem prepared to put fresh funds into the business.

On the sidelines, meanwhile, is rival JD Sports Fashion, which was once much smaller than JJB. It approached JJB with takeover proposals a few weeks ago but is unlikely to make a move until JJB has some certainty of survival.

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When my home buildings insurance came up for renewal this month, those nice people at the insurance company offered me the opportunity to pay in 12 monthly instalments rather than handing the whole lot over in one go. It seemed a good idea – until the small print revealed that I’d be charged interest of close to 20 per cent for the privilege of deferring the payments.

Not surprisingly, I turned down their kind offer.

With UK interest rates still at an historic low of just 0.5 per cent, where they have been for two years, there can be no justification for such blatant profiteering. But it is widespread throughout the financial services industry, which is celebrating its emergence from the financial crisis with a new-found determination to squeeze profit from its customers.

Thus charges on credit card debt have soared to their highest level in more than a decade, averaging at a shocking 18.9 per cent. Yet just three years ago, when the Bank of England base rate was 5.5 per cent, credit card charges were running at an average of 16.8 per cent, according to the price comparison website moneyfacts.co.uk. Savers, meanwhile, continue to get next to nothing on their accounts and what little interest they do receive is eaten up by inflation.

It’s the same story in the mortgage market, where margins have soared to an all-time high. That means anyone with a savings account at, say, the Halifax, will be earning as little as 0.2 per cent on their money while customers with a mortgage will be paying over 5 per cent.

And the bigger the bank, the worse the deal: while Britain’s largest lenders hold a commanding 75 per cent share of the home loan market, they provide just 29 per cent of the current top 500 mortgage deals.

Fiona Walsh writes for the Guardiannewspaper in London