‘As Mike Ashley steps back into the ring, why is he set on Boohoo for his comeback fight?’

For a man who nominally stepped back from retailing in 2022, Mike Ashley doesn’t seem to be enjoying a quiet retirement. 

Like a dragon squatting over its glittering hoard, Ashley has spent the last few years building up sizeable stakes in several retail brands. Twice in the last week now, he’s spotted the next glittering thing to add to his growing pile. 

First, it was struggling luxury brand Mulberry. After twice being rebuffed, Ashley walked away from his attempt to prize Mulberry away from its current owners earlier this week.

Not one to take defeat lying down, today Ashley threw his hat – and a live hand grenade – into the ring to be the next CEO of Boohoo. In a blockbuster open letter to the fast fashion retailer’s board, he demanded to be the one to replace departing boss John Lyttle. 

Boohoo “urgently needs to address the management of the business”, the letter read, adding that Boohoo has been “mismanaged” by the current senior team.

“There is no stronger candidate for CEO who has the experience and abilities of Mr Ashley and who is in a position to replace Mr Lyttle as soon as possible”.

Not being shy in coming forward himself, it’s likely that Kumani will give as good as he gets soon enough

The letter also claimed that Ashley had previously requested an in-person meeting with Boohoo co-founder and executive chair Mahmud Kamani to discuss demands for seats on the board, which had been ignored.

“We recognise stonewalling when we see it, and these tactics of ‘delay and ignore’ are no longer tolerable in the context of the continued value destruction that the board is overseeing at Boohoo”.

As of publication, Boohoo and Kumani have yet to respond – beyond issuing a hold-the-line statement to shareholders. Not being shy in coming forward himself, it’s likely that Kumani will give as good as he gets soon enough.

Strap yourselves in then ladies and gentlemen, the time for backroom financial wrangling is over. The moment calls for a knock-down, bare-knuckle brawl, and Ashley has been the first to take the gloves off.

It’s the heavyweight clash we didn’t know we’d been waiting for. Live from Manchester: Ashley v Kamani: Rumble in the Urban Jungle. M&A as a spectator sport, or as Shore Capital analyst Clive Black says: “This could be a bit of a blockbuster event, making the Mulberry duel with Challice look very tame.”

While his son-in-law Michael Murray has been the face of Frasers Group for the last few years, it’s an open secret that Ashley is still the one calling most of the shots behind the scenes

But beyond the frank pronouncements on the stock exchange, and the gentle purr of City analysts pulling up their front-row seats for a fight, Ashley’s letter today raises questions: both personal and professional.

Why does he want to come back into the retailing fray at all, let alone as the chief executive of a busted business caught between a voracious, cheaper, all-conquering competitor in Shein on one side and a shift in customer behaviour back to shops on the other?

Maybe he just misses the cut and thrust of helming a big retail business. But could his reasons be so prosaic? While his son-in-law Michael Murray has been the face of Frasers Group for the last few years, it’s an open secret that Ashley is still the one calling most of the shots behind the scenes. Is Frasers not keeping him busy enough?

Maybe then Mike Ashley is simply acting out of the goodness of his heart and a genuine concern for the decline of a once-successful British brand? If he really does just want to be the man to save Boohoo, he could be facing the biggest turnaround job of his storied career.

You never want to write a business off, but it’s hard to see how Boohoo comes back – at least in its current guise

In the stormy, post-pandemic environment, Boohoo has been washed onto the rocks and appears to be well and truly holed below the waterline.

The onetime pureplay market darling’s share price has plunged more than 90% since 2020 and is struggling to contend with falling demand, bloating costs and rocketing returns. And that’s before you get to the threat posed by Shein and Temu.

Frasers and Ashley have even played a part in this, having sold Missguided to Shein in October 2023.

You never want to write a business off, but it’s hard to see how Boohoo comes back – at least in its current guise. There seems to be no stopping the inexorable rise of Shein, and the group’s “young fashion brands’ like BoohooMan and PrettyLittleThing have been underperforming for years.

Intriguingly, for a fast-fashion group whose nominal target demographic is younger customers, its best-performing brands are legacy businesses Karen Millen and Debenhams.

Could this all just be the culmination of Ashley’s long and drawn-out mission to finally get his hands on Debenhams? Those in the know have always said the department store was Ashley’s white whale – the final piece of the high street jigsaw puzzle that slipped from his grasp.

Whatever his reasons, Mike Ashley’s back at the top of the card with his name up in lights. There could be any number of reasons why he’s chosen Boohoo for his comeback bout, but for now we should all just sit back and enjoy the show.