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(Alliance News) - Revolution Beauty Group PLC on Monday responded to "press speculation" regarding potential agreements with its former executive chair and chief executive officer.
On Friday, Sky News had reported that the London-based cosmetics retailer and its former CEO, Adam Minto, were discussing a potential GBP3 million payment from Minto to avoid a potential lawsuit over his alleged breaches of fiduciary responsibilities.
Revolution Beauty, Sky said, claimed Minto's actions had contributed to the substantial delay to the audit of its financial 2022 results, and to its shares being suspended in September 2022 from trading on AIM.
The shares resumed trading in late June this year. They were down 3.4% to 29.22 pence on Monday morning in London, though they have more than tripled in price since resuming trade.
Revolution Beauty had announced in late June that it intended to commence legal proceedings against Minto. In January, the company said a probe revealed that he had "made personal loans or other investments of approximately GBP1 million in aggregate to one of [Revolution Beauty's] distributors", as had former Executive Chair Tom Allsworth, in July 2021.
At the same time, an investigation by Forensic Risk Alliance and Macfarlanes had found that some sales should not have been recognised for the year that ended in February 2022.
Then, in July this year, Revolution Beauty disclosed that it was being investigated by the UK Financial Conduct Authority regarding potential breaches of market abuse regulations. It said it was fully complying with the probe.
Also in July, Revolution Beauty resolved a bitter dispute with major shareholder boohoo Group PLC. The compromise agreement included both Minto and Allsworth resigning from their positions.
Sky News also reported on Saturday that former Chair Allsworth, who co-founded Revolution Beauty with Minto in 2014, was also in discussions with the company to amend the timetable for deferred payments owed to him for his stake in hair and skincare company Medichem Manufacturing Ltd, which Revolution Beauty acquired in October 2021 for USD31.7 million.
On Monday, Revolution Beauty said it "remains in negotiation" on both the potential payment from Minto and revised agreement with Allsworth.
"There is no guarantee that agreements will be reached," the company warned. "Should agreements be reached, they would likely be treated as related party transactions and an appropriate announcement made at that time."
By Emma Curzon, Alliance News reporter
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