Revolution Beauty board departure as boohoo coup continues
Elizabeth Lake has announced she will stand down from the board of make-up retailer Revolution Beauty Group with immediate effect.
She will remain as chief financial officer until December 31, 2003, and will then be replaced as CFO by current non-executive director, Neil Catto, from January 1, 2024.
The shake-up means Manchester online retailer, boohoo, which holds an almost 30% stake in the business, has achieved its aim in ousting Ms Lake.
Boohoo launched a boardroom coup at Revolution this June, demanding the removal of chief executive Bob Holt, non-executive director Derek Zissman, and chief financial officer, Elizabeth Lake.
It proposed the appointment of boohoo non-executive directors Alistair McGeorge – who previously led Liverpool-based retailers Littlewoods and Matalan – and Neil Catto as Revolution directors.
After a very public spat, the two businesses reached a settlement in July concerning boardroom departures and appointments.
Today’s announcement is the latest development in the ongoing Revolution-boohoo saga.
Revolution also announce the appointment of Erin Brookes to the board as an independent non-executive director with immediate effect. Erin is a managing director with Alvarez & Marsal in London, where she leads the European Retail and Consumer Practice, specialising in retail turnaround and transformation.
Chairman, Alistair McGeorge, said: “Neil has been a trusted member of the board since joining five months ago, and I am pleased that he is now becoming CFO. I have no doubt that his considerable and relevant experience will prove a real asset as Revolution Beauty embarks on its next phase of growth. We are also delighted to welcome Erin. She brings a highly relevant skill set and I am confident she will make a significant contribution to our future success.
“At the same time, and on behalf of the board, I would like to express my sincere thanks to Elizabeth. Her leadership of the finance team over the past 18 months has proven invaluable in returning the business to a steady state. I wish her every success for the future.”
Elizabeth Lake said: “My focus over the past 18 months has been on addressing the well-documented issues the business has faced. During that time, we have significantly strengthened the group’s financial position, improved internal controls and implemented a full set of accounting policies that enabled the filing of the group’s financial statements and the resumption in trading of Revolution Beauty’s shares.
“With the business back to profitability and well placed for sustainable profitable growth, it is the right time for me to explore new opportunities. I would like to thank my colleagues for their hard work and dedication, and I wish them all the best as they continue to drive the business forwards.”
Neil Catto said: “As a board member since July, I have been hugely impressed with the inherent strength of the Revolution Beauty business, across its brands, its people and its products. I believe we have a considerable opportunity within a large and attractive beauty market, and I look forward to building on the strong foundations put in place by Elizabeth as the group targets long term sustainable growth.”
Revolution Beauty also announced that it has come to an agreement with Tom Allsworth, the former executive Chairman and co-founder of Revolution Beauty, regarding the settlement of certain claims between Revolution Beauty and himself, the timing of future payments relating to the prior acquisition of Medichem Manufacturing Limited (now called Revolution Beauty Labs Ltd) from Tom Allsworth by Revolution Beauty Holdings Limited, and Tom Allsworth’s future role within Medichem.
The group has agreed to pay Mr Allsworth an ex gratia payment of £270,000 net (£490,000, when grossed up for taxes) in respect of certain historical legal fees incurred by him in connection with, among other things, the investigation of matters related to the Medichem SPA.
As part of the arrangements, Mr Allsworth will continue in the management team of Revolution Beauty Labs with the title ‘Founder & Director of Revolution Labs’, though he will not be a statutory director, on terms which are substantively similar to those which applied to him previously.
Separately, and as originally announced on June 20, 2023, the group is continuing to seek a settlement agreement with Adam Minto relating to the events that led to the delay of the audit of Revolution Beauty’s FY22 results and the suspension of trading of the group’s shares on AIM during his time as chief executive.
Danni Hewson, head of financial analysis at Manchester investment platform, AJ Bell, said: “Boohoo seems to be tightening its grip on cosmetics firm Revolution Beauty after a bitter battle. Having built a substantial stake in the company, Boohoo forced out the CEO and chair in July.
“Chief financial officer Elizabeth Lake had remained in place but her departure, to be replaced by a former boohoo finance director, makes it clear who is firmly in charge. Revolution Beauty has also separately agreed a settlement on a dispute with one of its former founders and is in talks with another.
“Where this leaves beleaguered minority shareholders, who since the 2021 IPO have seen accounting issues and patchy trading take a significant chunk out of the value of the company, is up for debate. They will hope boohoo’s scale and retail knowhow can help the brand, but the online retailer itself hardly has an unblemished record.”
