Frasers blasts Boohoo’s ‘rushed’ CEO hire as it demands approval on sell-off

In a further open letter published today (6 November), Frasers Group asked Boohoo's board to "urgently and publicly confirm" that the business will not make a disposal of any asset or business line without prior shareholder approval.

It also requested that an independent adviser or investment bank must demonstrate the terms of the disposal are "fair and reasonable" and "is in the best interests of Boohoo’s shareholders" prior to agreeing to any disposal.

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."

On Friday (1 November), Boohoo Group announced that it had appointed Debenhams chief executive Dan Finley as its new CEO, to succeed John Lyttle. It comes after Frasers Group published an open letter proposing that Ashley be made director and CEO of Boohoo Group on 24 October.

It had previously criticised Boohoo for “a complete failure to meaningfully engage” with Frasers, its biggest shareholder with a 27% stake.

On 25 October, Boohoo Group responded robustly to Frasers’ demands, stating that a CEO appointment is a critical board decision that “requires careful consideration and proper governance”. It added that Frasers' comments are "inaccurate and unfair".

In today's letter, Frasers said on 31 October it asked Boohoo Group to confirm in writing that it would not start any process or enter into any agreement for a disposal of any of Boohoo’s assets "without first engaging with Frasers on alternative options" but the company had not done so.

The letter continued: "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.

"The restriction on disposals without shareholder approval and the requirement for confirmation from an independent global adviser or investment bank are required in order to protect the interests of Boohoo, its shareholders and its stakeholders. We are confident that we are not alone in these views."