Frasers Group has intensified its challenges against Boohoo’s leadership, calling for Mahmud Kamani’s removal and Mike Ashley’s appointment.
- Frasers criticized Boohoo’s performance, prompting demands for new leadership to address financial struggles.
- The group issued an open letter urging shareholders to replace Kamani with Ashley and Lennon to revamp Boohoo.
- Concerns about Boohoo’s competitive landscape were addressed by Frasers in their call for change.
- Boohoo recently announced Tim Morris as its independent Chair amidst these developments.
Frasers Group has escalated its demands for a leadership overhaul at Boohoo, directly calling for shareholders to remove Executive Chairman Mahmud Kamani. The open letter from Frasers stressed the company’s need for transparency and a return to profitability, citing Boohoo’s recent interim results as inadequate.
The letter, ahead of the December 20th shareholder meeting, reiterated Frasers’ stance that Mike Ashley and Mike Lennon should be on Boohoo’s board. According to Frasers, these appointments are critical to restoring Boohoo’s financial health and delivering long-term value for stakeholders.
Frasers’ proposal suggests that Ashley’s leadership would focus on transparency, enhancing financial stability, and addressing supply chain issues to re-establish Boohoo’s competitive spirit. The group believes that these changes are vital for Boohoo’s turnaround.
The letter also tackles allegations of anti-competitive implications if Ashley were to join Boohoo, especially given Frasers’ interests in brands like ASOS. Frasers’ legal advisor, Robert O’Donoghue K.C., dismissed these concerns, stating there’s no substantial competition law issue under UK legislation.
Despite Frasers’ claims, Boohoo announced Tim Morris as its new independent Chair. Morris, who will oversee the company’s business review, expressed his enthusiasm for guiding Boohoo through its next phase of development. His role aims to ensure shareholder interests are protected amidst these strategic shifts.
Mahmud Kamani has agreed to several assurances to align with the new strategic direction and avoid conflicts of interest. These include abstaining from commercial decisions involving competitors and waiving his salary for a year. Kamani has also committed to not making any offers for Boohoo shares or assets for six months.
The call for change by Frasers signifies significant shifts in Boohoo’s leadership as they navigate through strategic challenges.
