ZCZC
BCN-45
BRITAIN-NETHERLANDS-BREXIT-BUSINESS-UNILEVER
Marmite maker Unilever axes move from London to Rotterdam
THE HAGUE, Oct 5, 2018 (BSS/AFP) – Anglo-Dutch consumer giant Unilever,
maker of iconic products like Marmite, on Friday ditched its post-Brexit plan
to move its main headquarters from London to Rotterdam after a revolt by
shareholders.
The group, which also makes famous brands like PG Tips tea, Persil washing
powder and Ben and Jerry’s ice cream, said it was withdrawing a proposal that
would have seen its corporate base move to the Netherlands.
“The Unilever board has today decided to withdraw its proposal to simplify
Unilever’s dual-headed legal structure,” the company said in a statement.
The group had originally unveiled the planned switch in March in a
symbolic decision that was largely interpreted by analysts as a blow to post-
Brexit Britain.
But Unilever had in recent weeks faced mounting opposition from key
shareholders, including Royal London, Columbia Threadneedle, Legal & General
Investment Management, Aviva Investors, Lindsell Train, M&G Investments and
Brewin Dolphin.
A Unilever spokeswoman confirmed the company would no longer seek to
relocate away from the British capital.
“In developing the proposal, the board was guided by the opportunity to
unlock value for our shareholders by creating a stronger, simpler and more
competitive Unilever that is better positioned for long-term success,” the
statement added.
“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.”
Unilever has always insisted the move to Rotterdam was not related to
Brexit and said that its 7,300 workers in Britain and 3,100 in the
Netherlands would not be affected.
Yet the row over the looming move had started to drag on the company’s
performance with Unilever in July revealing a drop in sales in the first half
of 2018.
Unilever is also home to well-known products like Knorr soup, Magnum ice
cream and Dove beauty products.
– Blow to Dutch PM –
Chairman Marijn Dekkers left the door open for a move in the future,
insisting on Friday that the board continued to believe simplifying
Unilever’s structure remains in the firm’s best interests.
“Unilever has built a long track record of consistent and competitive
performance,” Dekkers 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.”
Unilever was founded in 1930 after the Dutch margarine producer Margarien
Unie merged with British soapmaker Lever Brothers.
For over a century, Unilever has maintained a dual-headed structure, with
listings on the London, Amsterdam and New York stock exchanges.
But in March, the company announced it was choosing The Netherlands over
London to host its headquarters, dealing a blow to Britain’s efforts to keep
multinational companies following Brexit.
The decision followed a failed hostile bid by US rival Kraft Heinz last
year, which analysts said played a key role in Unilever’s decision as the
Netherlands has stronger rules to protect companies against takeovers.
Friday’s announcement will come as a slap to Dutch Prime Minister Mark
Rutte, whose government has been angling for post-Brexit business from
Britain.
Rutte faces opposition to a plan to scrap a dividend tax in a bid to
attract international firms and cash in on Britain’s departure from the EU.
BSS/AFP/HR/1412