Boohoo CEO to step down as the group signs new debt financing deal
Boohoo Group has has signed a new £222 million debt financing agreement as it looks ahead to the next phase of its development.
The group has also announced that its board has decided to undertake a review of options for each of its divisions to unlock and maximise shareholder value. These include Debenhams, Karen Millen and its range of young fashion brands such as Boohoo, Pretty Little Thing and Boohoo Man.
The new debt facility compromises a £125 million revolving credit line that runs to October 2026 and a £97 million term loan that is repayable by August 2025. This is being provided by a consortium of its existing relationship banking group.
Mahmud Kamani, Boohoo group executive chairman said: “We are delighted to have agreed a new lending facility which shows the support of our existing banks and their confidence in the group.
“The business has evolved over last few years and has an offer that is much wider than our original focus on young fashion. The time is now right to consider options with regard to corporate structure, with the aim of maximising shareholder value.”
Boohoo has also announced that its chief executive John Lyttle has informed the board of his intention to step down, although he will continue to work with the leadership team and board to ensure a smooth transition to a successor.
Lyttle said: “Over the last five years I have been proud to lead the group and I believe there is huge potential in this business and I will continue to work with the board to drive value for all shareholders whilst a successor is found.”
In addition, the group has issued a trading statement for the six months to 31 August in which gross merchandise value fell by 7% to £1.177 billion. This included a 2% drop in the UK and respective declines of 18% and 21% in the US and rest of the world.
Meanwhile, EBITDA fell to £21 million from £31 million a year earlier.
The group said it expects a higher gross merchandise value and a stronger adjusted EBITDA performance in the second half of its financial year,
It added: “Whilst performance in the youth brands has remained impacted by the external environment, the group continues to see considerable GMV growth for Debenhams external marketplace, with an additional 5,000 brands signed within the period.”
