Mike Ashley calls to be appointed CEO of Boohoo, brand unveils identity refresh

Frasers Group’s Mike Ashley has requested to be appointed the chief executive officer and a director of fast fashion giant Boohoo Group where an apparent “leadership crisis” is resulting in declining revenues and a falling share price. The call was made in an open letter to Boohoo from Frasers, where it said the group is requisitioning a general meeting of Boohoo to make the leadership changes, which could also see Mike Lennon named a director.

It comes following the departure of Boohoo CEO John Lyttle, whose exit will leave a gap in the company’s leadership. According to Frasers, both Ashley and Lennon’s appointments are “the only way to set a new course for Boohoo’s future”, with the group therefore urging shareholders to vote in favour of the proposals. Frasers is currently Boohoo’s largest shareholder, holding 27 percent of the company’s issued share capital, an amount that has regularly been increased over time due to Frasers’ intention to operate as a “strategic investor”.

Now, however, the Sports Direct-owner has expressed concern over the management of the business after witnessing “abysmal trading performance and share price collapse”, noting in particular that revenues at the firm dropped 36.5 percent in the six-month trading period ending August 31, 2024. The share price, meanwhile, has dropped 17 percent in the last three months.

Boohoo using ‘delay and ignore’ tactics to avoid Frasers’ proposals

It was also noted that in Boohoo’s Business Update, published October 18, there was no reference to any cost savings, thus leading Frasers to believe that the board “has lost its ability to manage Boohoo’s business and investments”. Other evidence of this, alleged by Frasers, include an unsatisfactory approach to the terms of a debt refinancing and a suggestion that options were being explored to unlock shareholder value, to which the group said that “no disposals should be made without first consulting Frasers and all other major shareholders”.

Frasers further claimed that Boohoo was both delaying and ignoring any constructive proposals presented by the group, which it said it had made to the board on a number of separate occasions and included the idea of appointing new board members. Frasers had eventually met Boohoo management on October 18. The group asked for an explanation regarding the “inconsistent and contradictory responses” to its past proposal for board representation, however “no satisfactory explanation was given”. The proposal to place Ashley at the helm was instead left on a “holding response” that “further delays a situation where time is of the essence”.

The circumstances have thus led Frasers to publicly call for the appointment of Ashley to Boohoo’s board, after it assumed the board had rejected its offer for board representation. “For too long, this board has ignored the views of shareholders and refused to meaningfully engage with their ideas. But no longer. We are requisitioning a shareholder meeting to provide a referendum on the large-scale value destruction and long-term and continued incompetence of the current board and to provide a solution to boohoo’s leadership crisis,” the letter read.

Boohoo ushers in a new era to ‘change the rhetoric’

The letter falls alongside Boohoo’s revelation of an identity refresh, which it said marked an “exciting new era for the global retailer”. The creative redirection includes a new “bespoke custom designed logo” in a new handwriting, as well as a shift in the brand’s primary colour palette to blush and concrete tones that it said represented a “younger take on the brand”.

The brand refresh is accompanied by a new campaign, ‘People will talk…’, which it notably said “acts to change the rhetoric and usher in a new Boohoo era that will most certainly get people talking”. Speaking on the changes, Boohoo’s marketing director, Sam Leach, said: “Our team has worked tirelessly to bring the vision to life, and we’re thrilled with the result. Everything about it perfectly encapsulates who we are as a brand and where we want to be; bold, brave and confident. People will always talk about us, so get ready… the Boohoo renaissance has begun.”