Frasers Group has written another open letter to Boohoo demanding shareholders get approval before the group sells any of its assets and that it hire independent advisers to ensure fair terms, as it claims: “Desperate people do desperate things.”
The Mike Ashley controlled group, which owns 27% of Boohoo, accused the retailer having an “utter disregard for shareholder views”. It said: “Boohoo and its shareholders deserve better.”
The letter reads: “The directors have pushed Boohoo into a terrible refinancing, while refusing to engage properly with Frasers on it. They have then rushed out a CEO appointment to try to block the say of shareholders. This has to stop. What will they try next? Desperate people do desperate things.”
Frasers has also set up a dedicated website – www.boohoodeservesbetter.com – for the fashion retailer’s shareholders to provide all information regarding “Frasers’ solution to Boohoo’s leadership crisis”.
The Mike Ashley-led business wrote to Boohoo’s board last week to express its “grave concerns” about it selling assets after the fashion group launched a strategic review last month to “unlock and maxmise shareholder value”.
It is thought this will include breaking up the group, which owns brands including Debenhams and Karen Millen alongside its young fashion division of Boohoo, BoohooMan and PrettyLittleThing.
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Frasers asked to be engaged on “alternative options” before any disposals take place to ensure “that all options for securing best value for shareholders are appropriately reviewed and exhausted”.
However, the Sports Direct owner said the board had “refused to meaningfully engage” with it, leading it to make its demands public.
It said: “Given the market headwinds and commercial difficulties that Boohoo is currently facing, any asset disposals by the company, including of any of its five core brands or the Soho office, would be executed from a position of weakness and unquestionably be at a discounted valuation, and would therefore be wholly unacceptable without prior shareholder
approval.”
Last week, Boohoo snubbed Mike Ashley’s demand to be made its new CEO and handed the role to Debenhams boss Dan Finley in a move that the Frasers boss branded “desperate”.
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