Revolution Beauty (LON: REVB) shares are down a little bit, 3%, on the news that they really are going after those responsible for the company’s recent problems. However, unlike those rumours over the weekend, the journey has not reached its end. It’s an ongoing process, not something already signed, sealed and delivered.
As we’ve said before about Revolution Beauty: “Revolution Beauty (LON: REVB) has released an update to its past accounts. REVB has been suspended since autumn last year of course over these very accounts. This Revolution Beauty release is currently the most read news release on the Stock Exchange site. Not on the grounds that it's a large and important company - it isn't - but everyone's trying to work out why on Earth Boohoo bought into this mess? For note that we're now in May 2023. And REVB is only just able to release its accounts up to Feb 2022. As here: “Or Revolution Beauty plumped up and now suspended because its accounting isn't good enough to be audited. Which rather brings us back to BOO which, most inadvisedly, just invested in REVB just before the suspension.””
So, definitely, definitively, a problem back then. Not being able to file the accounts led to the suspension. There was then a recapitalisation, new broom management team and all that. But still those past problems, well, someone ought to pay.
Revolution Beauty share price from Google Finance
Which is what led to the stories over the weekend: “The founder of Revolution Beauty, the London-listed cosmetics group, is in negotiations to repay nearly £3m to settle allegations that he breached his fiduciary duties to the company.” That’s a fair old sum for an individual to have to pay. “Mr Minto's co-founder, Tom Allsworth, is also in discussions with Revolution Beauty to amend the timetable for deferred payments owed to him for his stake in Medichem, a haircare and skincare manufacturer, the sources added.” “Amend” thre means “lower”.
So, yes, that should be good news for the company and possibly the share price. As several are saying.
But the actual announcement is less bullish: “Revolution Beauty Group plc (AIM: REVB), the multi-channel mass beauty innovator, notes the recent press speculation regarding potential agreements with the Group's former Chief Executive Officer (CEO), Adam Minto, and former Executive Chairman, Tom Allsworth. As previously announced on 20 June 2023, the Group announced potential legal proceedings against Mr Minto regarding the events that led to a delay in the audit of the FY22 results and the suspension of the Company's shares from trading on AIM. Separately, and as previously announced on 31 August 2023, the Board is negotiating with Tom Allsworth, the previous owner of Medichem, to reach a revised agreement on the terms of its acquisition. Revolution Beauty remains in negotiation on both these issues. There is no guarantee that agreements will be reached.”
That is, we’re going after them, oooooh, yes we are. But we’ve not quite caught and skinned them yet.