Boohoo shareholders reject Frasers takeover attempts for a second time

Boohoo shareholders have decisively rejected Frasers Group’s attempts to remove Mahmud Kamani, the company’s founder and group executive vice chair, from the board of directors for a second time.

The online fashion retailer, announcing the results of today’s general meeting in Manchester, revealed that 63.17% of the votes cast opposed the resolution to dismiss Kamani, with only 36.83% in favour. The total votes represented 79.67% of the company’s issued share capital, with a fraction of votes withheld.

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Tim Morris, Boohoo’s independent non-executive chair, expressed gratitude to shareholders for their “overwhelming support,” describing the vote as an affirmation of the board’s direction: “I would like to thank our shareholders for their overwhelming support, which provides the board with a clear mandate to continue with the work of creating maximum value for all shareholders,” he said. “Today’s outcome follows the rejection in December of the previous Frasers attempt to destabilise boohoo. On both occasions 99 per cent of investors who are not connected to Frasers backed the board’s position.”

Mike Ashley’s Frasers Group owns a significant stake in boohoo – it became the largest shareholder last October and has been steadily upping its stake ever since to currently around 25% – but the majority of boohoo’s investors have consistently supported the current board since Frasers issued a series of letters calling for Kamani’s removal last year. The Sports Direct and House of Fraser parent hopes to replace Kamani on the board with its own Ashley. Frasers’ efforts were initially rejected by shareholders in a vote at a previous general meeting in December.

Boohoo, which benefited from a pandemic boom in online shopping, has since struggled with supply chain problems, higher product returns, subdued consumer demand, bad PR over working practices and supplier treatment, in particular a BBC Panorama doc which sent a reporter undercover at the firm’s Manchester HQ for 10 weeks, and competition from rivals such as Shein, which has hurt its bottomline.