LETTER FROM THE BOARD

Letter from the Board

13 November 2024

The Board of Directors recommends Shareholders VOTE AGAINST ALL Resolutions at the General Meeting

Dear Shareholder,

As we write to you today, the Board reflects on the journey we have taken together. From boohoo’s humble beginnings in Manchester to becoming a leading player in online fashion, our story is one of hard work, passion, and innovation.

The Board is excited about what lies ahead for boohoo under the leadership of our new CEO, Dan Finley. Dan has been with the Group for nearly three years now, joining as CEO of Debenhams. Under Dan’s leadership, Debenhams has gone through a period of significant growth and digital transformation, being transformed into ‘Britain’s online department store’. It has been successfully repositioned as a capital-light, cash generative and highly profitable marketplace model and we have been able to create a community of approximately 10,000 brands with more to come. We are extremely proud of what we have achieved in such a short period and we are looking forward to continuing that journey of growth with the wider Group.

The Board’s strategy is proactively to unlock and maximise value for the benefit of all Shareholders through our five core brands. We have appointed HSBC and Zeus as independent advisers to assist with this process, which we announced last month, and Dan will be working closely with the Board and our independent advisers as our review progresses.

The Board has a credible plan to realise value for all Shareholders. Frasers has not outlined an alternative plan to realise value for all Shareholders. Frasers’ Demands are, in the Board’s view, a clear attempt to destabilise boohoo. Having regard to Frasers’ conduct with other public companies, the Board is concerned that Frasers may be seeking to take control of the company without paying fair value or seeking to acquire its assets significantly below market value for the benefit of Frasers alone – a key trade competitor to the Group.

Frasers will no doubt say that their actions are those of a concerned shareholder and not a trade competitor that is focused on its own commercial self-interest. In considering Frasers’ real motivations, Shareholders should consider Frasers’ prior behaviour in relation to its investments in public companies and the way in which it has sought to leverage these investments for its own commercial advantage.

Since becoming a significant shareholder in boohoo, Frasers has already sought to leverage its position for its own commercial advantage by pushing boohoo to adopt its FCA regulated FrasersPLUS credit offering across boohoo’s platforms.

Further examples of Frasers’ leveraging its position for its own commercial advantage include the following (non-exhaustive) case studies:

Studio Retail Group plc, formerly Findel plc, which was the subject of a sustained corporate campaign by Frasers over several years. This included a shareholder requisition to appoint Benjamin Gardener as a director of the company and attempts to install Mike Ashley onto the board as Chairman. In the last public disclosure of its shareholding, Frasers held just under 30 per cent. of the share capital of Studio Retail. Frasers ultimately succeeded in acquiring the assets of Studio Retail out of administration for £1 and settled the company’s remaining secured liabilities for approximately 50 per cent. of their face value. Other Shareholders in Studio Retail look likely to lose the entire value of their investment.
Matchesfashion, which was purchased by Frasers’ Group for £52 million in December 2023 and put into administration approximately three months later. A Frasers’ subsidiary then acquired the brands and assets from the administrators, offsetting the amount due to another Frasers’ subsidiary as secured creditor.
Base Childrenswear Limited (“Base Childrenswear”), which was acquired by Frasers from JD Sports alongside Kids Cavern and 13 other brands for a total of £47.5 million. The stores were soon closed and subsumed into Flannels as part of its kidswear range. Thirteen months later, Base Childrenswear’s and Kids Cavern’s respective boards of directors put Base Childrenswear and Kids Cavern into administration, appointing Mike Lennon as one of two joint administrators in both cases. On 16 September 2024, the business and assets of Base Childrenswear were sold to Sportsdirect.ComRetail Limited (a Frasers subsidiary) for £102,500 (excl. VAT). According to the joint administrators’ Progress Report to Creditors dated 7 October 2024 in relation to the company, the joint administrators accepted this offer despite it being below the valuation they had obtained for the company’s intellectual property.

Shareholders should be concerned by these examples. In our case, the timing of Frasers’ Demands is no coincidence, coming at the point where the Group has refinanced its debts, appointed Dan as our new CEO and launched our Business Review to turn the corner after difficult recent trading conditions.

The Board has a credible plan to unlock and maximise value for all Shareholders and it seems to the Board that Frasers appear to wish to disrupt this plan, which is not in the interests of all Shareholders.

Pages 7 to 11 of the Circular contains detailed explanatory statement setting out why, in the opinion of the Board, the Resolutions to be proposed at the General Meeting are contrary to the best interests of the Company and Shareholders as a whole. Accordingly, the Board is unanimously recommending that Shareholders vote AGAINST the Resolutions, as the Directors intend to do in respect of their own beneficial holdings of shares, which amount to approximately 14.11 per cent. of the Company’s issued share capital.

The Board is not deliberately seeking confrontation with Frasers, but will at all times act in the best interests of the Company and all Shareholders. By rejecting Frasers’ Demands, Shareholders will give the Board a mandate to insist on the commitments providing the safeguards the Company requires from Frasers.

The remainder of the Circular includes the Board’s explanatory statement, details of how to vote at the General Meeting, some shareholder Q&A, a statement that Frasers asked the Board to circulate to Shareholders along with the Notice of General Meeting, the Notice of General Meeting itself and additional information in respect of the Notice of General Meeting (here) including relation to the appointment of proxies.

The results of the voting on the Resolutions will be announced via the Regulatory News Service and published on our website as soon as practicable following the conclusion of the General Meeting.

YOUR VOTE MATTERS.

Please VOTE AGAINST the Resolutions to reject the Frasers’ Demands.

On behalf of the Board, thank you for your continued support of boohoo.

Yours sincerely,

Mahmud Kamani (Group Co-Founder and Executive Chairman)