Frasers Group, the owner of Sports Direct, House of Fraser and Flannels, has written to Boohoo ordering it to sack its chief executive and appoint Frasers founder Mike Ashley instead.
Boohoo, the online fast fashion retailer, had ignored a private Frasers request to install Mr Ashley, according to an open letter from Frasers Group to members of Boohoo’s board.
Frasers can influence Boohoo as it’s the biggest shareholder, owning 27% of all shares.
“The company urgently needs to address the management of its business,” the letter read. “The board has lost its ability to manage Boohoo’s business and investments.
“There has been a complete failure to meaningfully engage with us, your largest shareholder.
“We recognise stone-walling when we see it, and these tactics of ‘delay and ignore’ are no longer tolerable in the context of the continued value destruction that the board is overseeing at Boohoo.”
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Frasers added it assumed the request to appoint Mr Ashley had been rejected as it has received only “holding responses” resulting in delay “in a situation where time is of the essence”.
What are Frasers Group up to and what do they want?
The letter demanded a seat on the board to represent Frasers Group and called for a general meeting of the company. as well as the removal of current CEO John Lyttle as a company director.
Mr Lyttle announced last week he would resign but no date was given nor detail on a potential successor.
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Billionaire Mr Ashley had stepped away from the day-to-day running of Frasers Group and in 2022 appointed his son-in-law Michael Murray as CEO.
Frasers recently tried to take over luxury handbag maker Mulberry, is a big shareholder in online fashion platform Asos and had been in talks to become the new British partner of Ted Baker, the collapsed fashion chain.
What has Boohoo said?
In response to the letter Boohoo said: “The Boohoo board is in the process of reviewing the content and validity of the requisitions [Fraser demands] with its advisers. A further announcement will be made in due course.
“In the meantime, shareholders are urged to take no action.”