The world leader in FMCG goods, Unilever, which presently has headquarters in London and Rotterdam, had planned to move its operations to the Netherlands and but has now changed its plans. The firm had announced plans to move out to the Netherlands but investors in the UK said that the shift would force them to sell their shares and did not support the move. Though Unilever stated that the proposal to shift headquarters did not get support from “significant group of shareholders,” the board believes that simplifying its Anglo-Dutch structure was in the best interests of everyone.
Company chairman Marijin Dekkers said that its board will now consider the next steps to engage with shareholders and try to convince them. The existing dual structure of the firm has been in place since 1930 when Dutch margarine making firm Unie merged with British soapmaker Lever Brothers. Unilever is one of the UK’s largest firms and is listed among FTSE’s 100 share index and is valued at £124 billion. This firm owns top brands like Pot Noodle and Ben & Jerry’s ice cream and will continue to be listed on the London Stock Exchange.
If the proposed change of location had been carried out as scheduled, Unilever would not have been eligible to remain on the 100 FTSE list. Investors had objected to the move due to this fallout as they were worried that the change would lead to massive sell-off among local investors due to which the firm’s share price would fall. Some speculated that the firm was changing its location due to the ongoing Brexit issue – though the firm has firmly denied that Brexit was not the cause. Some experts suggest that the move could be a reaction to the hostile takeover bid by Kraft Heinz that was not successful. Shareholders expect broad changes at the firm’s board level with exit of non-executive directors from the company.