JD Sports bought Irish sports clothing retailer Champion for £1 in January.
This latest development would consolidate the JD and JJB brands – two of the highest-profile destinations for sports clothing on the high street.
If the takeover is successful, it is not clear whether the JJB brand will remain, or be replaced by the JD brand. It seems likely that duplication on the high street would cause some stores to close.
JD Sports released a statement to the London Stock Exchange this morning (2 February), confirming it is "in early stage discussions with the board of JJB Sports in relation to making an offer for JJB Sports. There can be no certainty that an offer will be made by JD Sports Fashion for JJB Sports, nor as to the terms on which any offer might be made. A further announcement will be made in due course."
A similar statement was made simultaneously by JJB Sports.
As predicted in December, JJB Sports, which has around 250 stores, had a poor Christmas trading season. It was in danger of breaking banking covenants in December, blaming poor trading on the snow.
JD Sports, which also owns brands such as Size?, Bank and Scotts, and has some 500 stores, traded well over the same period. JJB is valued at around £30m.
The two companies are distinct on the high street, despite their similar names and despite carrying many of the same products.
JJB Sports focuses on value sporting clothing. JD Sports had pitched itself to be a fashion destination for younger people, but carrying many of the same sports brands.