Unilever scraps plan to move HQ to Netherlands after UK shareholder revolt

A
woman stands behind a machine that is part of a toothpaste
manufacturing line at the Unilever factory in
Lagos
Thomson
Reuters

• Withdrawal means that for now, Britain gets to keep one
  of its most valuable companies as it moves closer to
  Brexit.
• Scrapped plan seen as victory for shareholders, who had
  opposed the move.
• Unilever decided to collapse its Anglo-Dutch structure
  after a business review sparked by last year’s failed $143
  billion takeover approach by Kraft-Heinz.

 

Unilever — the maker of Dove soap and Ben & Jerry’s ice
cream — has abandoned plans to move its corporate headquarters
from London to Rotterdam in the face of growing opposition
from UK investors,
Reuters reported. The withdrawal means that for now, Britain
gets to keep one of its most valuable companies as it moves
closer to Brexit.

It’s also seen as a victory for UK shareholders, who had
spoken out against the move, which would have kicked the company
out of the benchmark FTSE 100 index. Shareholders representing
about 12% of the shares had publicly opposed the
move. 

“The board will now consider its next steps and will
continue to engage with our shareholders,” Chairman Marijn
Dekkers said, according to Reuters. He added that the company
will proceed with the plan to cancel its Dutch preference
shares.

London Mayor Sadiq Khan tweeted that he supported the
move.

“It’s great news that Unilever has chosen to keep its HQ in
London & abandoned plans to move it to Rotterdam. Despite the
Govt’s appalling mishandling of the Brexit negotiations, the
capital will always be one of the best cities in the world to do
business,” he said.

Their main practical concerns were around the forced selling of
their shares with no premium, uncertainty around the future tax
treatment of Dutch dividends and a perception that the move was
in part aimed at securing the greater takeover protections under
Dutch law.

Unilever decided to collapse its Anglo-Dutch structure after a
business review sparked by last year’s failed $143 billion
takeover approach by Kraft-Heinz. But Unilever said it
recognised that the proposal had not received support from a
significant group of shareholders and therefore it considers it
appropriate to withdraw.

Earlier this week, influential proxy advisory firm PIRC
recommended shareholders vote against the move.