Frasers Group PLC (LSE:FRAS) has alleged fashion retailer Boohoo Group PLC (AIM:BOO) is making undisclosed payments to Umar Kamani, the son of founder Mahmud Kamani, in another escalation in its battle for control.
On Tuesday, Boohoo shareholders rejected a motion proposed by the Mike Ashley-controlled Frasers to remove Mahmud Kamani from his role as executive vice chairman, prompting an open letter from the Sports Direct owner last night.
Boohoo bought the prettlylittlething business from Umar Kamani in 2020 and in its letter Frasers said it 'had been made aware of reports' that he is still receiving £2 million annually in payments for consultancy services.
Frasers said that any consultancy arrangement raises “conflict of interest” concerns and it has asked for clarification about the situation.
“Frasers remains deeply troubled by Boohoo’s governance practices and lack of transparency of material arrangements,” the open letter added.
Frasers owns around 27% of AIM-listed boohoo.
The two companies have been involved in an acrimonious boardroom battle following the resignation of John Lyttle last October with Ashely fiercely criticising the performance of the online retailer.
Last December, Frasers lost a vote to get Ashley voted in as chief executive and restructuring specialist Mike Lennon elected as a boohoo director by a large margin.