Unilever relocation could be UK ‘body blow’

The company is considering moving its head office to Rotterdam in The Netherlands, although Unilever has confirmed that no decision has yet been made. It is expected that a decision will be made next month at a board meeting.  Currently the company has two headquarters in Rotterdam and London.

The Financial Times​ has reported that Prime Minister Theresa May was braced for Unilever to choose the Netherlands over the UK for its new unified headquarters. Despite this there were still intensive efforts being made by the government to ensure it kept or increased some of its activities in Britain, the newspaper revealed.

It was thought that the move would place the focus on the impact of Brexit despite the restructuring of the company being implemented in the wake of the attempted takeover of the company by Kraft Heinz. The company wanted to restructure to protect itself from any potential takeover bids.

Priorities ​

Black told Food Manufacture​ that Unilever must determine where it based its head office according to how it saw the future priorities of the business.

“If that decision takes its headquarters to The Netherlands then no doubt it will be another point-scoring item in the somewhat tedious Brexit debate,” ​he said.

“Clearly, such a move would be a bit of a body blow to the reputation of London as a business centre and a corresponding boost the Dutch corporate scene, although quite whether Lever’s employees prefer going out in downtown Amsterdam to London remains to be seen.”​

However, he also said in the “big scheme”​ of Unilever as a business and as a listed entity, the location of its headquarters was “likely to be less symbolic and far from seismic”.​

Leaving the EU​

“No doubt there will be other such stories as businesses work out the best way for them to play the UK leaving the EU, albeit one senses that most Britons are totally disinterested in the machinations from Westminster and Brussels, as opposed to understanding the lay of the land in due course.”​

Meanwhile, Julian Wild, partner at Rollits, said it was “​​highly likely”​ that Unilever would move its group HQ to Rotterdam.

“It has been under pressure to make a decision on London or Rotterdam and it now looks odds-on that it will base itself in the Netherlands,”​ he said.

“If Brexit does finally happen, it has to make more sense for a global player like Unilever to be based within the EU. There is the additional factor that Unilever is the subject of activist shareholder attention and is seen as a potential takeover target, which hastened the sale of its spreads business recently.​

“Moving the HQ to Rotterdam would undoubtedly make a hostile takeover far more difficult than in the UK and Brexit provides the perfect excuse.”​