THE HAGUE: Consumer giant Unilever said today it will combine its Dutch and British arms in one London-based company, two years after a failed bid to move its headquarters to the Netherlands.
The maker of Ben and Jerry's ice cream, Dove soap and the yeasty spread Marmite said ending its 90-year-old double-headed structure would make it more responsive to challenges including the coronavirus pandemic.
But it insisted that its presence in both countries would be "unchanged", and it would keep its listings on both the London and Amsterdam stock exchanges.
"We remain committed to The Netherlands and the UK and there will be no change to Unilever's footprint in either country," Unilever chairman Nils Andersen said in a statement.
The British government hailed the decision, which comes months after Britain left the European Union in a move that critics said could harm the country's economy.
"Delighted to see Unilever's proposals to become a fully incorporated UK company – a clear vote of confidence in the UK," Business Secretary Alok Sharma tweeted.
Dutch Economic Affairs Minister Eric Wiebes said he "regretted" the decision but added that "jobs and activities remain in the Netherlands, which is positive”.
Unilever said that an 18-month review showed the current Anglo-Dutch structure could "create disadvantages", for example with its huge tea business, parts of which may soon be spun off.
"It is also clear that the Covid-19 pandemic will create a business environment in which having as much flexibility and responsiveness as possible will be critically important," it said.
The Dutch entity would therefore be merged into one single parent company based in London, Unilever PLC, "creating a simpler company with greater strategic flexibility, that is better positioned for future success."
Unilever was founded in 1930 after the Dutch margarine producer Margarien Unie merged with British soapmaker Lever Brothers, but has kept its dual-headed structure since then.
It has since become a global behemoth with brands also including Lipton tea, Magnum ice cream and Knorr foods.
In 2018 Unilever tried to move the firm's corporate base from London to the Dutch port of Rotterdam. At the time it denied that it was prompted by Brexit. But it had to back down after a revolt by shareholders in Britain as that plan would have ended its listing on the London stock exchange.
Unilever said under the new plan there would be "no change to the operations, locations, activities or staffing levels in either the United Kingdom or The Netherlands as a result of unification".
The firm's food and refreshments division, which accounts for about 40% of turnover, would remain in Rotterdam while the home care and beauty and personal care divisions would stay in the UK.
Analyst Sophie Lund-Yates of Hargreaves Lansdown said the move was a "surprise" and a "big departure from the failed plans of 2018" in that it would keep a double stock market listing. But she added that "any move that contributes to Unilever becoming a more agile machine is a step in the right direction", especially given "lacklustre" recent sales figures, and the coronavirus outbreak.
However the "big question" was whether shareholders in the Dutch arm would oppose the plan, as their British counterparts did two years ago. – AFP
