Revolution Beauty has hit back at Boohoo’s attempted leadership coup, calling it “value-destructive, opportunistic and self-serving”.
The stern response comes after Boohoo revealed it would vote against the reappointment of Bob Holt, Derek Zissman and Elizabeth Lake at the beauty brand’s AGM on 27 June.
The fast fashion retailer, which is also Revolution Beauty’s largest investor, expressed concerns that the current leadership team was not delivering shareholder value.
Boohoo proposed to appoint Alistair McGeorge and Neil Catto as Interim Executive Chairman and CFO respectively in place of the current board.
A “rigorous” process to appoint additional independent directors would then take place by the reconstituted team.
But Revolution Beauty said the e-tailer's actions were a “cynical attempt” to seize control of the company without financial outlay.
It stressed that the move was also a “reckless strategy”, unless Boohoo was confident it would get support from other shareholders of the company.
“The current directors believe that boohoo's actions create considerable risk to the prompt restoration of trading in the company's shares and its stakeholder relationships, and appear calculated to destabilise rather than support the business,” Revolution Beauty said in a statement.
The takeover attempt comes after Revolution Beauty filed legal action against brand founder Adam Minto.
A letter of claim sent to the former CEO alleges that he breached his statutory and contractual duties to the company.
This is said to have contributed to the delay in the audit of Revolution Beauty’s FY22 results and subsequent suspension of the company's shares.
Revolution Beauty added it was attempting to recover funds relating to the “exceptional costs” it incurred as a result of the situation through this legal action.
The embattled beauty brand has been faced with a challenging year after its auditor BDO launched an investigation into a series of counting and management failures.
This came after Revolution Beauty failed to publish its FY22 accounts in February last year.
The Big Four accountancy firm’s report found that co-founders Minto and Tom Allsworth had made personal loans of around £1m to distributors and a senior employee.
Other issues which were flagged included sales to one of the distributors, which accounted for around 56% of all FY22 orders with that company.