Revolution Beauty has defended the actions it took at its AGM this week after it reinstated three members of its senior team who had been voted out by shareholders.
According to the cosmetics retailer, its actions had been “firmly validated” by the stock market response, resulting in shares rising yesterday.
“The response from the stock market and the group’s wider stakeholders firmly validate the actions taken following the AGM earlier this week, which were lawful and entirely consistent with the directors’ legal duties,” Revolution Beauty said in a statement.
Revolution Beauty’s CEO, CFO and chair were all kicked out at the AGM after online retailer Boohoo, which holds a 26.6 per cent stake in the company, led a successful vote against the board members.
As a result, 75% of shareholders backed the decision but the trio were then allowed to be re-elected by independent director Jeremy Schwartz.
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The company argued that this was the only way to secure readmission to AIM, as firms need a full board of directors.
“The directors did not and do not intend to frustrate shareholder democracy but were put in an extremely difficult position by Boohoo’s actions,” it said.
“The directors faced a binary choice between taking action which would result in the re-admission to trading of the company’s shares the very next day (unquestionably in all shareholders’ interests) or taking action (or inaction) which would have resulted in no re-admission to trading for an unknown amount of time.”
Revolution Beauty also rejected the claim that 75% of shareholders had voted with the fast-fashion retailer.
It claims only around 39% of the shareholder base cast votes at the AGM, with just 29% backing the decision.
Following the AGM, Boohoo accused Revolution of “contravening best practice in relation to corporate governance”, which the cosmetic company claimed was “extremely ironic”.
“As shareholders will be aware, Boohoo has a long and well-documented track record of substandard corporate governance and legal, repetitional, supply chain and shareholder engagement issues.”
