Unilever picks The Netherlands for head office
Billed as a move to make Unilever a “simpler, more agile and more focused business”, the process will see two legal entities merged into one that is incorporated in The Netherlands.
Unilever will be focused on three divisions – Beauty & Personal Care, Home Care, and Foods & Refreshment. Its Food & Refreshment division, which is responsible for brands such as Marmite, Flora, Knorr, Hellmann’s, Magnum, Ben & Jerry’s and Lipton, will be based in The Netherlands.
The company’s Beauty & Personal Care and Home Care divisions will continue to be located in the UK.
Marijn Dekkers, Unilever chairman, said: “Unilever’s board is fully committed to delivering long-term performance and sustainable value for shareholders. The board believes the move to three divisions and the simplification of our corporate structure will create a simpler, more agile and more focused company with increased strategic flexibility for value-creating portfolio change.
“Our decision to headquarter the divisions in the UK and the Netherlands underscores our long-term commitment to both countries. The changes announced today also further strengthen Unilever's corporate governance, creating, for the first time in our history, a ‘one share, one vote’ principle for all our shareholders.”
Unilever has also pledged that its 7,300 UK workforce will not be affected during the process and the proposed “simplification” is subject to shareholder approval in both The Netherlands and the UK.
Last month, Clive Black, head of research at analyst Shore Capital, told Food Manufacture that Unilever relocating its head office to The Netherlands would be a “body blow to the reputation of London”, while some City analysts said Unilever might have to leave the FTSE 100 when the process is completed.
Ernesto Bisagno, vice-president – senior credit officer at Moody’s and lead analyst for Unilever, added: “Simplification of the corporate structure will leave Unilever bondholders unaffected, as we expect that existing bondholders will continue to be treated equally.
“We expect that bonds issued by the group will continue to benefit from the existing guarantees plus the guarantee from the new parent company.”
