Boohoo blasts Revolution Beauty for handing out £2m to prime bosses
B
oohoo has demanded Revolution Beauty clarify why it handed out greater than £2 million in share awards to its bosses with out the approval of traders.
The battle between the 2 retailers reached boiling level after magnificence model Revolution Beauty defied a shareholder vote and reinstated its management workforce.
It led to its shares returning to the AIM market, after a suspension on buying and selling in place since September was lifted.
Its senior administration workforce was subsequently granted free share choices – which means they got shares within the firm – to “reward them for the hard work done” and for bettering the group’s gross sales, the agency stated.
Shares granted to chief govt Bob Holt, finance chief Elizabeth Lake and chairman Derek Zissman have been value about £2.1 million mixed.
The struggle between Boohoo and Revolution Beauty will as soon as once more depart traders questioning about governance requirements at London’s AIM-listed corporations, which have typically did not match these of corporations listed on the principle market
Boohoo, which is a majority shareholder with a 26.6% stake in Revolution Beauty, stated shareholders weren’t consulted over the scheme nor did they approve of the freebies being given out.
The style retailer demanded that the total particulars of the share choices be revealed.
“This all demonstrates a lack of transparency and actions which are self-serving and not in the best interests of shareholders”, Boohoo stated.
The ongoing spat demonstrates the less-stringent governance requirements inside the smaller London index, funding specialists steered.
Lindsey Stewart, director of funding stewardship analysis for Morningstar, stated: “The fight between Boohoo and Revolution Beauty will once again leave investors wondering about governance standards at London’s AIM-listed companies, which have often failed to match those of companies listed on the main market.
“The allegations of self-dealing and significant accounting misstatements at Revolution are reminiscent of the failure of Patisserie Valerie almost five years ago.
“And while Boohoo – as owner of over a quarter of Revolution’s equity – is quite right to be concerned about the allegations, Boohoo itself (also AIM-listed) has been in the headlines regularly over the years due to deep concerns over its governance arrangements and its oversight of working conditions in its supply chain.”
He added that the spat comes at a time when the monetary watchdog is consulting to introduce modifications to London market’s itemizing guidelines which is able to “hand founders and directors more power at the expense of shareholder rights”.