Frasers calls on Boohoo to oust founder Kamani as row continues

Frasers has openly called for Boohoo shareholders to oust Mahmud Kamani from the company and instead appoint Mike Ashley to the board, citing that “urgent change is needed” at Boohoo following its latest “dismal” results.In its latest open letter to shareholders, the Mike Ashley-owned group, which is a majority shareholder of Boohoo, continued what has been an ongoing public feud between the two groups over Boohoo’s governance. 

The letter noted that Boohoo’s board of directors have been asked to remove Kamani, saying “recent events, in particular the results, lack of transparency and further supply chain allegations, should leave shareholders in no doubt – Mr. Kamani must go”.

It added that a “failure to vote, or voting against these resolutions, will only result in further value destruction for all shareholders”. 

The letter concluded: “Shareholders have lost money and there is justified disappointment with and distrust of the current leadership, in particular, Mr. Kamani. With the appointment of Mr. Ashley and Mr. Lennon, Boohoo has the potential to become a valuable and profitable business. Boohoo urgently needs a reset, and the upcoming shareholder meeting is your opportunity finally to unlock the company’s incredible potential. Join us in helping Boohoo get back on track.”

It comes as Boohoo’s board has today announced it unanimously agreed to appoint Tim Morris as its independent chair with immediate effect, replacing Kamani in the role.

Following his appointment, Kamani will become executive vice chair with immediate effect.

Boohoo said Morris’ appointment follows a “series of decisive steps” taken since announcing a review of the business, including the appointment of Dan Finley as CEO and the fundraising of £39m.

Meanwhile, the latest letter from Frasers also outlined that “while Frasers had sought for Mr. Ashley to also be appointed as Boohoo’s CEO, the board has refused to put this to a shareholder vote, based on a questionable technicality”.

Ashley previously called Boohoo’s decision to appoint a CEO from within “desperate”, after the fast-fashion retailer rejected Frasers’ demands to appoint Ashley as leader of the group.

Following the internal promotion of Debenhams CEO Finley to lead Boohoo, Ashley told the Sunday Times: “Independent shareholders be warned, desperate people do desperate things.”

Earlier this month, it was then reported that Boohoo was excluding a meeting with Frasers amid the ongoing row between the two companies over its governance.

Finley was understood to be meeting some of the company’s biggest investors, yet no meetings were scheduled with anyone from Frasers Group.

Boohoo has also raised “concerns” over Frasers’ behaviour in a recent open letter to the Mike Ashley-owned company, as the row over Frasers’ involvement in Boohoo continued, with the retailer accusing Frasers of “commercial self-interest”. 

Its latest response comes as Frasers sought stronger involvement in Boohoo’s strategic review, with Boohoo calling the move “inappropriate” due to the fact Frasers is a trade competitor and not an independent shareholder in the online retailer. 

Last month, Frasers called on Boohoo to appoint Ashley as director and CEO of the struggling online company, after slamming the “continued incompetence” of the current Boohoo board amid an “abysmal” trading performance. 

In another open letter to Boohoo, Frasers urged the company to remove outgoing CEO John Lyttle as director and appoint Ashley as chief “without delay”, adding that his appointment would be in the “best interests of the company, its shareholders and its stakeholders”.