The battle over the future of Boohoo heated up today when the board of the fast fashion retailer rebutted demands from shareholder Mike Ashley that he be installed as chief executive.
The Sport Direct retail tycoon’s Frasers Group published an open letter yesterday in which is ordered boohoo to sack its current CEO John Lyttle and appoint Ashley.
The letter said the board had “lost its ability to manage Boohoo’s business and investments” and accused directors of “stone-walling.”
But today Boohoo responded robustly saying it had “neither delayed responding to Frasers’ requests for board representation nor ignored them.”
It said Frasers’ demands had first been made a face to face meeting last Friday “when Frasers sought to establish a 48-hour deadline for the board to confirm that it would proceed to make this appointment.
It added: “This was the first occasion on which Frasers had identified its preferred Board candidate and followed Frasers having formally ruled out Mr Ashley for the role on 9 October 2024 and having previously and consistently indicated that its one nominee would perform a non-executive role.”
The statement continues: “As shareholders will be aware, Mr Ashley is a 73% shareholder in Frasers; in addition, Frasers owns a 23.6% stake in ASOS, and both Frasers and ASOS operate in similar markets to boohoo. These are important facts that need to be taken into account and carefully considered by the board.”
Boohoo said is would be willing to talk to Frasers about board representation “in a constructive manner” but insisted “appropriate governance will be required to protect the Company’s commercial position and the interests of other shareholders”.
Boohoo said shareholders should take no action in response to the demands.
The statement also rejected Frasers description of boohoo’s recent debt refinancing as “inaccurate and unfair.” It continued: “The refinancing provides certainty for the Company around its future requirements and is supported by its existing group of high street banks.”
