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Peter Cowgill, the chairman of JD Sports has revealed the company is considering opening a new distribution centre in the EU to overcome some of the challenges caused by the UK leaving the EU.
Speaking to the BBC, Cowgill said the current impact of Brexit for retailers has been “considerably worse’ than he feared with extra extra red tape and shipping delays causing millions in extra costs.
As such, he revealed the company is considering opening a new distribution warehouse in mainland Europe. While he added that a new distribution centre would not lead to the closure of its Rochdale site it could mean a “transfer” of jobs to the new warehouse.
“The new system and red tape just slows down efficiency. The freedom of movement and obstacles are quite difficult at the moment. I don’t see that regulatory paperwork easing much in the short term,” Cowgill told the BBC.
The news comes after the retailer announced the completion of the placing of new ordinary shares in the business’ capital, which raised £464.2m for the company, to be used for future acquisition plans.
A total of 58,393,989 new ordinary shares in the retailer were placed by Investec and Peel Hunt, at an issue price of 795 pence per share, representing around 6% of the existing issued capital.
The placing price represents a discount of around 2.5%, to the mid-market closing price of 815 pence on 3 February.
Following the successful fundraise, JD Sports said a number of potential acquisition and expansion opportunities are now available to the sports retailer.
