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Mike Ashley’s Frasers Group has written another open letter to fellow shareholders of online fast-fashion retailer Boohoo, sharply criticising co-founder Mahmud Kamani and again demanding that Ashley be appointed as a director.
Simultaneously, Boohoo said on Thursday that Kamani had been moved from executive chair to executive vice-chair with Tim Morris, a board member since 2021, becoming chair.
Boohoo said Kamani would waive his salary for the next 12 months and had given various undertakings, such as not to do anything that would result in Boohoo being unable to operate, nor to attempt to buy Boohoo or any of its assets.
Boohoo’s statement partly meets one of Frasers’ demands that “Mr Kamani must go” as executive chair, but Frasers said it had written separately to Boohoo’s board demanding a shareholder meeting to remove Kamani and prevent it from “simply reappointing him or any other director before Boohoo’s next AGM”.
Frasers, of which Ashley owns 73 per cent, is the biggest individual shareholder in Boohoo, with a 28 per cent stake, according to LSEG. Kamani owns 12.6 per cent.
The two businessmen have locked horns in recent months over the future of Boohoo, with Frasers claiming it was being “mismanaged” and criticising a recent £222mn refinancing, which again on Thursday it called a “catastrophe”.
Boohoo, meanwhile, last week urged shareholders to vote against Frasers’ demands to appoint Ashley as a director at an upcoming meeting with investors on December 20, saying the sportswear tycoon is “not suitable” for such a role.
The online retailer has previously argued that it needed to protect its commercial position, because of Frasers’ stake in rival online retailer Asos, noting that both Frasers and Asos compete in similar markets to Boohoo.
On Thursday, Frasers, known for its Sports Direct brand, separately said that it had published the “legal opinion of a leading KC”, who concluded “there is no competition law issue, nor even a realistically arguable one” in relation to Boohoo’s conflict of interest concerns.
Boohoo’s shares have lost more than 90 per cent of their value since their peak in June 2020, when the retailer was buoyed by a boom in online shopping during the pandemic. Shares in Frasers have more than doubled over the same period.
Boohoo declined to comment. Frasers said: “His title might have changed but his grip on the company has not . . . Mr Kamani must go.”
