Boohoo calls on shareholders to reject Mike Ashley’s board bid

Boohoo has urged its shareholders to vote against Mike Ashley’s board appointments ahead of its AGM on 20 December.

In an update posted this morning, Boohoo revealed that independent proxy adviser Institutional Shareholder Services (ISS) has recommended shareholders vote against Fraser’s bid for board representation which would see Ashley as CEO and Mike Lennon as a board member.

It said that the ISS states that Frasers has offered a “superficial view of performance and no specific plans for change”. It also highlighted what it thought were “potential conflicts of interest” from its proposed board members Ashley and Lennon.

Commenting, Dan Finley, boohoo Group CEO, said: “I believe that the group is fundamentally undervalued. There is no doubt that there is enormous opportunity for the group and I am determined to get back to being a disruptive and industry leading business.

“Working with Tim, our independent non-executive chairman, overseen by our independent board, I am fully focused on creating maximum value for, and protecting the interests of, all shareholders.”

The decision reportedly pre-dates a new open letter from Ashley released yesterday (8 December) in which he claims he would bring “the fresh ideas, constructive support, and the much-needed accountability boohoo desperately needs”.

In the letter Ashley revealed that in a meeting with Finley last week they discussed “a number of opportunities”, particularly around Debenhams, and that they both agreed on the “enormous potential” to scale the brand. Ashley added he was “excited” at the prospect of working collaboratively with Finley to turn around the group.

Critical to that turnaround, Ashley said, would be avoiding a “fire sale of assets at knockdown prices” and that Debenhams should not be sold.

A Frasers spokesperson said: “The ISS opinion pre-dates the statements from Mr. Ashley yesterday. Mr. Ashley set out clearly in his letter of 8 December his determination to work on behalf of all boohoo shareholders and support Dan Finley to deliver on the opportunities to turn around the fortunes of the group and restore shareholder value.

“He has been very clear he would not want Debenhams sold or any fire sale of assets and has put on record his commitment to transparency and shareholder consultation, something badly missing under the current board. To achieve this, boohoo shareholders must vote for the resolutions on 20 December.”