Frasers Group urges Boohoo for transparency and shareholder approval before selling assets, highlighting serious concerns over current management actions.
- Frasers has accused Boohoo of not considering shareholder opinions, emphasizing the need for independent advisers to ensure fair terms.
- The open letter criticizes Boohoo’s quick CEO appointment as a strategy to bypass shareholder involvement.
- Frasers stresses that any asset sales under current market conditions would yield undervalued outcomes for investors.
- A dedicated website has been launched to provide Boohoo shareholders with solutions to leadership issues.
Frasers Group has openly requested that Boohoo seek shareholder approval before proceeding with any asset sales. The company, holding a significant 27% stake in Boohoo, highlights its concerns over the retailer’s disregard for shareholder interests and the need for fair transaction terms ensured by independent advisors. Frasers insists: “Boohoo and its shareholders deserve better.”
The letter from Frasers criticizes Boohoo’s leadership, asserting that they have forced the company into unfavorable refinancing without proper engagement from Frasers. This action has prompted Frasers to demand a halt to such proceedings until shareholders have a say. The swift appointment of a new CEO, Dan Finley, is viewed as a tactic to sideline shareholder input, with Frasers’ leadership labeling these moves as ‘desperate.’
Frasers has proactively established a dedicated website aimed at informing Boohoo’s investors about its proposed solutions to the leadership issues currently faced. This platform outlines Frasers’ stance and the necessity for a strategic review to ensure maximum shareholder value, cautioning against breaking up the group hastily.
The request from Frasers to engage on ‘alternative options’ came shortly after Boohoo resisted Mike Ashley’s proposal to assume the CEO role, a move that further strained relations. Frasers argues that any sale of Boohoo’s major assets or locations would occur under unfavorable conditions and at reduced valuations, which is unacceptable without consulting shareholders.
Frasers remains firm on demanding Boohoo to engage shareholders meaningfully before proceeding with asset disposals.
