Proxy adviser backs Boohoo vice chair in Mike Ashley row
Proxy voting adviser Institutional Shareholder Services (ISS) has backed Boohoo in its row with Mike Ashley and Frasers Group, urging shareholders to vote against firing the company’s co-founder and vice chair Mahmud Kamani.
In November, Frasers demanded that Kamani be removed as a director of Boohoo, leading the firm to call a general meeting scheduled for later this month (21 January).
Today, both the independent proxy group ISS and Boohoo’s board (excluding Kamani) unanimously backed Kamani, arguing he should remain in his post.
“Kamani is an integral part of the leadership team. His counsel, guidance and insight to Dan Finley, group CEO, the rest of the board, and the wider business remains invaluable,” said said the Boohoo board in a stock exchange notice today.
The news comes following Mike Ashley’s failed attempt to have him and restructuring specialist Mike Lennon elected to Boohoo’s board last month.
More than 63 per cent of votes were cast against the appointment of the billionaire at a general meeting in Manchester, with almost the same number of votes also cast against Lennon.
The fast-fashion giant and its billionaire shareholder have engaged in an extended public spat over the last few months, including over who would become the new CEO of Boohoo following the departure of John Lyttle.
Frasers Group, which owns companies such as House of Fraser and Sports Direct, is the largest single shareholder in Boohoo with a 28 per cent stake.
Ashley called for Kamani to be replaced in November, before his attempt to be elected to the board was thwarted.
“The board is of the view that in pursuing this campaign, Frasers is acting solely in its own commercial self-interest,” argued the Boohoo board today.
Kamani was the chair of Boohoo until November, when he was replaced by Tim Morris, and has since been appointed executive vice chair, in a move which Boohoo said “reflected the changing needs of the business”.
“The question for shareholders to consider ahead of voting at the general meeting is not therefore whether Kamani should remain as the company’s chair, but whether he should remain as a director having already stepped down as chair,” the company added.
In addition, Kamani has agreed to waive his current salary from Boohoo over the next year.