Glass Lewis urges a vote against Frasers’ Boohoo proposals, Frasers seeks to dampen governance worries (#1685751)

A second shareholder advisory service has come out in support of Boohoo Group’s view that its shareholders should vote against the Frasers Group proposals at the upcoming general meeting.

Glass Lewis, the independent proxy adviser, has urged shareholders to vote against Frasers’ aim of board representation.

The recommendation by Glass Lewis follows that of ISS, which also recommended that shareholders should vote against the resolutions.

Glass Lewis said that “shareholders would not be well served supporting the appointment of the Dissident Nominees [Mike Ashley and Mike Lennon] at this time”.

It believes that “appointing a director with significant historical ties to Frasers, without a comprehensive agreement in place to mitigate potential conflicts of interest, could raise further concerns among investors”.

The Boohoo board is also opposing the resolutions, saying it already “has a credible plan to unlock and maximise value for the benefit of all Shareholders through its Business Review and in Dan Finley has the right CEO to lead the business”.

It also cited competition concerns over Ashley being on the board and said “Mike Lennon is a practicing insolvency expert with a history of working closely with Frasers; Shareholders should ask themselves why Frasers would want him in situ at Boohoo”.

Meanwhile Frasers, the largest shareholder in Boohoo, said later on Thursday its two nominees for the board of the online fashion retailer would sign up to all protocols to address any governance concerns, if they were to be elected.

In an open letter to Boohoo shareholders on Thursday, the company urged them to vote in favour of the duo’s appointment to attain “the best and most credible path to profits”.

Responding to the letter, a Boohoo spokesperson said, “Independent shareholders be warned. Desperate people do desperate things.”

Written with Reuters