Fashion retailer Boohoo has revealed plans to raise £39.3 million through a share placement as the company grapples with mounting losses that have more than tripled in recent months. The London-listed organisation announced the fundraising initiative will combine new share placements, subscription agreements, and a retail offer.
The embattled retailer, which owns brands including PrettyLittleThing, Dorothy Perkins, and Burton, reported group revenues fell by 15 per cent to £619.8 million in the six-month period ending August. Pre-tax losses expanded dramatically to £147.3 million from £36.6 million in the same period.
The fundraising announcement comes amid escalating tensions with Mike Ashley’s Frasers Group, which holds a 27 per cent stake in the business. Boohoo has urged shareholders to vote against resolutions proposed by Frasers at its upcoming general meeting on 20 December, citing concerns over the group’s past behaviour and intentions.
Boohoo’s board has expressed apprehension about Frasers’ motives, questioning whether the group aims to maximise value or potentially acquire Boohoo’s assets below market value. The company’s co-founder and chairman, Mahmud Kamani, who owns approximately 15.5 per cent of shares with his son Umar, has publicly stated he has “no intention” to make an offer for the fashion group.
The share placement price has been set at 31 pence, offering a premium over the previous closing price. The raised capital will be utilised to reduce group borrowings and provide strategic flexibility following recent debt facility agreements. The move reflects the mounting pressure on Boohoo as it faces fierce competition from ultra-fast fashion rivals such as Shein.
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