Mike Ashley denied vote on Boohoo boss’s £150m bonus

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Boohoo has blocked Mike Ashley from voting on a £150m bonus scheme for its chief executive.

The development comes as the online retailer launches an attempt to turn around its languishing share price.

The board of Boohoo, which was recently renamed Debenhams Group, said it intended to approve the scheme without a shareholder vote, which is a typical process for listed companies.

It will mean Mike Ashley, who is Boohoo’s largest shareholder with a stake of almost 30pc through his retail empire Frasers Group, will be barred from voting on the proposals.

In an update to investors on Thursday, Boohoo said that a “major competitor” and a “significant shareholder” had set out to “disrupt Debenhams Group’s growth strategy and operations” by voting against a series of measures at past shareholder meetings.

Mr Ashley has been locked in a bitter row with Boohoo’s board and its founder, Mahmud Kamani. The Sports Direct tycoon has accused Mr Kamani of ignoring the best interests of investors and, in August, attempted to oust him and two other members of Boohoo’s leadership team.

He also attempted to block Boohoo’s decision to rename its business as Debenhams earlier this year. Mr Kamani and Mr Ashley first clashed in 2021 over control of the collapsed department store chain.

Boohoo said that while it had previously sought shareholder support for its management bonus schemes, it believed that “approval at a general meeting would not be most likely to promote the success of the company”.

Bonus scheme turnaround efforts

Under the proposed bonus plan, Daniel Finley, Boohoo’s chief executive, would receive a maximum possible payout of £148.1m if the company’s share price rises from 10.5p to £3 over the next five years, and is maintained at £3 over the final three years.

The suggested payout is part of a wider bonus scheme that will see senior leaders share up to £222m if they can rebuild the company’s valuation from £145m to £4.2bn.

Boohoo, which also owns Karen Millen and PrettyLittleThing, was once valued at more than £5bn during its pandemic peak in 2020, but its shares have since collapsed as it struggles to compete with rivals such as China’s Shein.

Boohoo said its new bonus scheme was needed to ensure its executives could “execute the turnaround strategy over the coming years and consequently restore profitability and unlock value for all shareholders”.

It came as Boohoo posted a 23pc drop in sales to £296.9m during the first six months of the year compared with a year earlier.

However, the company also disclosed a sharp drop in losses, costs and overall debt, boosting shares by as much as 40pc on Thursday morning to around 16p.

Mr Finley said: “Our turnaround is gathering real pace. We are making progress, we are moving fast, and we are transforming the business.”

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