(Bloomberg) -- Boohoo Group Plc said an influential proxy advisor has recommended that investors vote against rival Frasers Group Plc’s request for board seats at the fast-fashion retailer.
Frasers, founded by billionaire Mike Ashley, has offered “no specific plans for change,” Boohoo said in a statement summarizing the recommendation from Institutional Shareholder Services Inc.
Boohoo’s shares slid in early London trading before paring back the losses. The stock is down about 7% in the past 12 months.
The recommendation could pose a challenge to Ashley’s bid for influence at the fast-fashion retailer. He owns more than a quarter of Boohoo shares through Frasers. In an open letter Sunday, Frasers said Boohoo must avoid a rushed sale of assets as it tries to turn around its performance.
Boohoo, which owns the Debenhams, Karen Millen and PrettyLittleThing brands, said last month that it’s undertaking a strategic review — a move that could potentially lead to the breakup of the company. It also named former Debenhams boss Dan Finley as its chief executive officer, in a snub to Ashley who had been campaigning for the role.
Frasers said Monday that the ISS’s opinion predates Ashley’s latest letter to Boohoo investors. In it “he has been very clear he would not want Debenhams sold or any fire sale of assets and has put on record his commitment to transparency and shareholder consultation,” it said.
Boohoo’s shareholders are due to meet on December 20 to vote on the resolutions.
(Updates with Frasers response and context.)
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