A company led by a former boss at Lush has said the retailer’s board has failed to record the transfer of a near 20% stake it acquired in the cosmetic firm.
Silverwood Brands, of which former Lush chief executive Andrew Gerrie is an executive director, said in December it had bought 19.8% of the Dorset-based company from Mr Gerrie and his wife Alison Hawksley for £216.8m – payable in Silverwood shares.
In an update on the London Stock Exchange, Silverwood said it had received a notification from Lush declining to record the transfer of shares to its wholly owned subsidiary, Cosmic Circles.
Silverwood said Lush had “failed to provide any reasons for this”, and solicitors had been instructed to seek further clarification from Lush.
The firm said it was “disappointed by the response from Lush”, adding: “The company believes the transfers complied with Lush’s articles of association and therefore it believes Lush’s actions have no merit.
“Together with its legal advisers, Silverwood will seek to engage with Lush and its solicitors to resolve the current situation, however the Company will explore all options available to it to protect its interests for the benefit of its shareholders as a whole.”
Silverwood went on to say: “As a purported arbiter of fairness, ethics, and champion of environmental, social and governance issues, the company is surprised that Lush is behaving in this manner and expects that ultimately it will stand by their ethos and avoid potentially prejudicing minority interests.”
Lush said its board had “no choice” but to refuse the transfer.
In a statement, the company said: “The company’s regulations contain specific criteria that must be met when a shareholder sells their shares. Under UK law, the board of directors has a clear duty to ensure that all of these regulations are complied with at all times.
“After careful consideration, the board of Lush concluded that the proposed sale of shares by Andrew Gerrie and Alison Hawksley to another company was not compliant with these regulations. The board therefore had no choice but to refuse to record a transfer of their shares.”
Lush operates retail stores around 50 countries and has six manufacturing facilities, including its factory in Poole.
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