Boohoo rejects claims it ‘ignored’ Frasers amid leadership battle

Boohoo has denied allegations that it “delayed and ignored” Frasers Group’s proposals for board representation.

Frasers published an open letter on Wednesday accusing Karen Millen’s owner of “obstructing” and failing to “meaningfully engage” in the issue.

The FTSE 100 firm, whose brands include Sports Direct, Slazenger and Jack Wills, has urged Boohoo to replace John Lyttle as its chief executive with retail tycoon Mike Ashley.

He said this was the “best solution” to the company’s “leadership crisis”, but Boohoo is reportedly considering Umar Kamani, son of founder Mahmoud, to succeed Lyttle.

In his letter, Frasers said he wrote a letter on October 9 requesting an in-person meeting with Mahmud Kamani to discuss leadership matters, “as soon as possible.”

The group claimed that Boohoo “completely ignored” their suggestions in its first response, but shortly afterwards offered to hold a meeting, which eventually took place on 18 October.

Frasers wrote: ‘At this meeting, we requested an explanation regarding the totally inconsistent and contradictory responses received from Boohoo to Frasers’ proposal for Board representation. No satisfactory explanation was given.’

The Derbyshire-based company has asked for a response by October 20 to its proposal to appoint Mike Ashley.

However, on Wednesday he wrote: “Instead, we have received responses that cause further delays in a situation where time is of the essence.”

“Frasers therefore has no choice but to assume that the board has rejected Frasers’ proposal for representation on the board.”

However, Boohoo said it had “not delayed responding to Frasers’ requests… nor ignored them”.

The Manchester-based firm also claimed that Frasers “formally ruled out” Ashley for the chief executive role on October 9.

However, he said Frasers’ desire for Ashley to be nominated for the role “was first communicated” at last Friday’s meeting.

In addition, Boohoo noted that Ashley owned a majority stake in Frasers, which in turn owned a 23.6 per cent stake in rival online clothing retailer ASOS.

Boohoo said: “Frasers has made clear that before any appointment can be made, appropriate governance will be required to protect the company’s commercial position and the interests of other shareholders.”

Both Asos and Boohoo enjoyed huge growth during the early stages of the Covid-19 pandemic, when the temporary closure of fashion stores led Brits to buy their clothes from e-commerce retailers.

Over the past two years, its sales have slowed significantly and retreated due to customers returning to stores, cost of living pressures and considerable competition from companies such as Chinese rival Shein.

boohoo shares rose 1.75 per cent to 29p by mid-afternoon on Friday, while Frasers Group Shares They were 0.25 per cent higher at 796.5 pence.