Struggling British sportswear retailer JJB Sports says investors including Bill Gates have backed a £31.5m fund-raising to keep the firm alive.

JJB said the Bill and Melinda Gates Foundation Trust, which holds a 5.5% stake, had agreed to support a capital raising at 5p a share - a 25% premium to Wednesday's closing price - along with JJB's other main investors Harris Associates, Crystal Amber and GoldenPeaks Capital. The four together hold 44.3% of JJB shares.

JJB shares have lost more than 80% of their value over the last year before news of the fund-raising.

The retailer, which issued a profit warning in November, said its main lender Bank of Scotland had agreed to waive covenant tests for the firm's £25m facility on the basis of the proposed capital raising. The company had warned earlier this month it was likely to breach the covenant.

JJB also shook up its board, with chairman John Clare and chief financial officer Lawrence Coppock stepping down to be replaced by Mike McTighe, a former Cable & Wireless executive and restructuring expert, and Dave Williams, former finance director of discount retailer TJ Hughes.

Gates, the billionaire philanthropist and founder of Microsoft, is no stranger to struggling British retailers, having built up a significant holding in Carpetright, the nation's biggest floor coverings retailer.

News of JJB's funding lifeline offset news of dire pre-Christmas trading, with sales at stores open over a year slumping 15.7% in the six weeks to December 19. Analysts were also alarmed by JJB's warning that the proposed fund-raising would not address its medium and longer term working capital requirements.

JJB was driven to the brink of administration during the recession, but survived thanks to a deal to sell its fitness clubs to founder Dave Whelan, a debt restructuring with creditors, new banking facilities and an equity fund-raising.

Under new chief executive Keith Jones it has since been refitting stores and improving its internet business within a strategy targeted at keen amateurs, recreational sports participants and sporting families.

But analysts believe the group has suffered recently from a step-up in promotions and advertising from market leader Sports Direct, which is controlled by Newcastle United soccer club owner Mike Ashley.