Shareholder opposition halts move which would have forced multinational off FTSE 100
Unilever has bowed to shareholder pressure and scrapped plans to move its corporate headquarters from
London to
Rotterdam.
The consumer goods giant said on Friday it was withdrawing a proposal to “simplify” its dual-headed Anglo-Dutch legal structure, which would have moved its corporate base to the Netherlands.
The announcement followed dissent from several major shareholders over the past few weeks, including
Royal London, Columbia Threadneedle, Legal & General Investment Management, Aviva Investors, Lindsell Train, M&G Investments and Brewin Dolphin.
Unilever said: “We have had an extensive period of engagement with shareholders and have received widespread support for the principle behind simplification.
“However, we recognise that the proposal has not received support from a significant group of shareholders and therefore consider it appropriate to withdraw.”
Had the move gone ahead, Unilever’s shares were unlikely to have continued trading on the FTSE 100.
The chairman, Marijn Dekkers, said the board continued to believe structural simplification was in the firm’s best interests.
“Unilever has built a long track record of consistent and competitive performance,” he said. “The board continues to believe that simplifying our dual-headed structure would, over time, provide opportunities to further accelerate value creation and serve the best long-term interests of Unilever.
“The board will now consider its next steps and will continue to engage with our shareholders. We will proceed with the plan to cancel the NV [Dutch limited company] preference shares, further strengthening our corporate governance.”
Unilever first announced plans to simplify the business from two legal entities into a single one, incorporated in Rotterdam, in March.
It dealt a major blow to the UK government and its efforts to uphold Britain’s status as a centre for business after Brexit.
However, Unilever has throughout insisted the move to Rotterdam was “nothing to do with Brexit”. It also said at the time that its 7,300 workers in the UK and 3,100 in the Netherlands would remain unaffected by the changes.
Unilever, which is behind well-known household brands such as Ben & Jerry’s ice-cream, Persil and Lipton teas, employs about 169,000 people worldwide.
Business Secretary Greg Clark welcomed the decision to scrap the move. “Unilever has a long and proud history in the UK and I welcome this decision by Unilever’s board having listened to its shareholders. “
Clark added: “The UK is one of the best places in the world to grow a business, and our modern Industrial Strategy commits us to being an open and competitive economy and a great place to locate global headquarters.”