Revolution Beauty blasts ‘opportunistic and self-serving’ Boohoo boardroom coup
osmetics brand Revolution Beauty has blasted the “opportunistic and self-serving” move of its shareholder Boohoo to oust its bosses, accusing the fashion retailer of attempting to engineer a cheap acquisition.
The troubled make-up business hit back at what it described as a coup and insisted it was on the road to recovery.
It followed Boohoo, which owns a 26.6% stake in Revolution Beauty, revealing on Monday plans to vote against the reappointment of the firm’s chief executive Bob Holt, chairman Derek Zissman and chief financial officer Elizabeth Lake at its upcoming annual general meeting (AGM) on June 27.
The approach taken by Boohoo towards Revolution Beauty is nothing short of value-destructive, opportunistic and self-serving
Boohoo called for a separate meeting to oust the three bosses and replace it with its own directors. Revolution Beauty has been stabilised under their leadership but it now needs to focus on growth, it argued.
“The approach taken by Boohoo towards Revolution Beauty is nothing short of value-destructive, opportunistic and self-serving”, the make-up brand responded on Tuesday.
The company went on to say the timing of the move is “perhaps no coincidence”, being three days before Boohoo’s own AGM and “amid reports of widespread shareholder opposition resulting from Boohoo’s persistent management and corporate governance failures over a prolonged period”.
Boohoo sunk to a loss of almost £91 million last year, from a profit of £7.8 million the prior year, after sales slipped by more than a 10th.
The retailer was affected by rising costs, including shipping, staffing and energy, as well as shoppers returning to the high street.
Revolution Beauty also suggested the coup could be a “tactic to destablise the group”, force it into administration and then buy it at the lowest possible price.
The fast-fashion retailer has a track record of buying businesses in financial distress, Revolution Beauty said, citing its acquisitions of Karen Millen, Coast and Nasty Gal in recent years.
It comes a day after Revolution Beauty suggested it could take legal action against its founder and former chief executive Adam Minto.
The group said it sent a letter of claim to Mr Minto last month alleging that he breached his duties to the firm.
It said it was looking to recover “material sums” after being hit by hefty costs as a result of the former boss’s actions which allegedly contributed to a delay in its 2021-22 results. Its shares have been suspended since last September.
But Revolution Beauty insisted its products have been selling well and its “fortunes are finally looking up” after a turbulent period, suggesting its shares could resume trading imminently.
It urged shareholders to vote in favour of reappointing the current directors at its AGM next week.