Finance

Britain loses battle for Unilever HQ

Britain loses battle for Unilever HQ

Its beauty and personal care division and its home care division will be based in London, while its foods and refreshment division will be based in Rotterdam.

Unilever, the Anglo-Dutch consumer goods multinational whose vast stable of brands includes Dove, Knorr and Ben & Jerry's, has opted to have its sole headquarters in the Netherlands rather than Britain, ending a dual structure that goes back almost 90 years.

Although the company did not specifically cite Brexit as a reason for its move in the end, the decision is expected nonetheless bruise Theresa May's government with just a year to go until the United Kingdom is due to quit the trading bloc.

Instead the company claims that the new structure will make it "simpler, more agile and more focused".

British Government officials reportedly met with Unilever to express their concerns that the London headquarters would be axed in favour of the Netherlands, but failed to convince them over the benefits of basing its main offices in the UK.

Unilever owns more than 400 brands, with a turnover in 2016 of over €50 billion and many of its brands like Axe/Lynx, Dove, Hellmann's, Knorr, Lipton, Lux and Magnum have sales of more than €1 billion.

Unilever chose to consolidate its headquarters after staving off an unsolicited takeover bid from Kraft Heinz Co. past year.

Under its current structure, the shares of Unilever NV can not be exchanged for those in Unilever PLC, its British sibling.

He added that while Unilever may choose to maintain its listing on the London Stock Exchange, it could drop out of the blue-chip index. Its shares will remain listed in London, Amsterdam and NY but Unilever, Britain's third-biggest company by market value, is likely to leave the FTSE 100 index.

The British government also had a positive take, saying that Unilever was basing its two fastest-growing divisions - Beauty and Personal Care and Home Care - in Britain and stressing that Brexit was not a factor.

According to Marijn Dekkers, chairman of Unilever, "Unilever's Board is fully committed to delivering long-term performance and sustainable value for shareholders".

"Since the British vote in the EU referendum in June 2016, governments, local authorities and business networks in various European countries have worked hard to improve the investment climate in their markets in order to attract multinationals headquartered in London that may be wary of Brexit".

Chief executive Polman has warned ministers that current rules do not give companies fair protection from hostile bids, saying a year ago: 'When you have a situation like this, with a national champion, there should be a level playing field'.

"I am informed that it is the stronger anti-hostile takeover protection offered in the Netherlands in particular that has dominated the decision to adopt Rotterdam as its sole headquarters".


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