Blacks launches new bid to get out of red

The group, which hopes to raise just less than 20 million in its latest attempt, was forced to abandon earlier plans after Mike Ashley's sportswear firm threatened to veto them.

Blacks hopes it can now side-step opposition from Sports Direct, which holds a near 27.2 per cent stake, after restructuring the vote in a way that only requires a simple majority of shareholders.

Chairman David Bernstein said: "The group has made progress in a difficult but ultimately productive year."

He said the group was now "ready to accelerate the final phase of the turnaround plan", with the proceeds from the fundraising used to invest in the current estate and to open 35 new stores.

The firm, whose history stretches back to the 1860s when Thomas Black set up a sail-making business in Greenock, also posted a pre-tax loss of 43.6m for the 12 months to 27 February, compared to a 6.6m deficit the previous year, as exceptional costs soared after the firm was forced to fight for survival.

Last year saw a restructuring and the closure of 88 loss-making stores after Blacks secured a rescue deal with its landlords.

The group said it finished the year "strongly", with like-for-like sales up 5.4 per cent, while same stores sales growth from its ongoing estate was 9.5 per cent in the second half.

The chain, which has 313 Blacks, Millets and Freespirit stores, said like-for-like sales in the first six weeks of the new financial year are "in line with the strong comparatives of 2009".

Analyst Freddie George at Seymour Pierce said an annual pre-tax loss of 7.9m for the ongoing business was in line with market expectations.

"Management has started to resolve the legacy issues and is now beginning to come up with a strategy for its two brands, Blacks Leisure and Millets, which is compelling, logical and will leave the two brands clearly differentiated," he said.