Retail group Boohoo has kicked off an activism campaign that seeks to gain control of the board at Revolution Beauty.
Boohoo announced earlier this week that it would vote against the re-election of senior members of the beauty company’s board at its upcoming AGM.
The retailer, which is the largest shareholder in Revolution Beauty, owning 26.6 percent of the issued share capital, says it will vote against the reappointment of CEO Bob Holt, chair Derek Zissman and CFO Elizabeth Lake and propose the appointment of two new directors.
In a regulatory announcement Boohoo says that as Revolution Beauty transitions to its next phase, ‘the focus must switch to growth’.
‘Boohoo believes a senior leadership team with the right retail, e-commerce and consumer brands experience is required to deliver shareholder value,’ the filing adds.
Boohoo proposes to replace the existing board members with two former affiliates of the retailer’s board – Alistair McGeorge and Neil Catto – who were previously non-executive director and CFO, respectively. Rachel Horsefield, former CEO of beauty at The Hut Group, will also be included as a proposed board member.
In response to the hostile move from its largest shareholder, Revolution Beauty says it’s been forced to postpone its AGM to a later date.
‘The board believes Boohoo’s hostile requisition is value-destructive, opportunistic and self-serving, as well as not being in the interests of the company’s shareholders as a whole,’ the firm responds.
‘Boohoo’s actions appear to be a cynical attempt to seize control of the company without financial outlay nor any compensation to Revolution Beauty shareholders and would appear to be a reckless strategy unless Boohoo were confident of support from other shareholders of the company.’
Revolution Beauty adds that Boohoo’s move has been carried out without the retailer needing to pay ‘a single penny’ to independent shareholders and with ‘no reasonable justification’ for its wholesale and dramatic proposed changes to the executive management team.