Boohoo says Frasers can have seat on board, but not retail tycoon Mike Ashley

Boohoo has offered a seat on its board to its largest shareholder, Frasers Group – but not for retail mogul Mike Ashley, the founder of Frasers. The fast fashion retailer said on Friday it was open to "constructive" discussions about Frasers' board involvement. However, it highlighted that current nominees, Mr Ashley and restructuring specialist Mike Lennon, would face "irreconcilable conflicts of interest".

The fast fashion retailer has been subject to a campaign by Frasers’ boss Mr Ashley to get himself installed as chief executive at Boohoo in recent months. That was cut short when Boohoo appointed Dan Finley, former boss at Debenhams, which it owns, in November. Mr Ashley pivoted towards seeking a seat on the board, an overture that Boohoo has consistently resisted.



In correspondence on Thursday, Frasers levelled the accusation that Boohoo's reticence to include Mr Ashley and Mr Lennon is driven by a fear of diluted control for Mahmud Kamani, a Boohoo co-founder. The retail giant also maintains that its manoeuvres aim to shield minority shareholders from a rumoured scheme by Boohoo leadership to fragment the company in a revival strategy. Possessing a 27% slice of Boohoo, Frasers has called an urgent shareholder gathering set for a vote on December 20.

In a Friday morning statement, Boohoo said the letter indicated that Frasers was taking a “selective approach” to shareholder protection. "When it comes to protecting minority shareholders, Frasers will decide which commitments it wishes to give and on what terms," the company stated. Boohoo chair Tim Morris commented that Mr Ashley and Mr Lennon are "not appropriate candidates to join the Board in any circumstances" due to "obvious conflict points".

"Notwithstanding that, Frasers continues to refuse to agree to a number of the key protections that the board would require should an appropriate representative be nominated. These are key issues which need to be addressed for the protection of all shareholders and it is not for Frasers to pick and chose which commitments it will give.” Earlier this month, a significant shareholder advisory group, Institutional Shareholder Services (ISS), recommended Boohoo investors vote against Mr Ashley’s pursuit of a board position at the December 20 meeting.

Furthermore, Mr Ashley lashed out at Mr Kamani, labelling him as an "egotistical founder who has an unhealthy grip on the board" and claimed that Boohoo is "in desperate need of the guidance I can provide". He cautioned about a recovery strategy entailing the "fire sale of assets at knockdown prices", specifying that the Debenhams brand, in particular, should not be sold off..