JJB Sports on Friday night announced it was planning to issue shares to Sports Direct International in return for an injection of cash as the struggling retailer scrambled for funding.

The sports retailer, led by Chris Ronnie, said it had struck a deal with Mike Ashley’s Sports Direct to raise £3.4m ($5.9m) of cash in return for a share issue of 11.9m shares, equivalent to 5 per cent of the company.