Unilever’s Dutch shareholders have overwhelmingly backed plans to transfer the Anglo-Dutch company into a London-based entity, a significant step in the consumer group’s attempts to simplify its corporate structure.
The FTSE 100 company said more than 99 per cent of investors in its Dutch arm had voted to base the entire group in London, reversing a foiled attempt two years ago to house the business in the Netherlands.
A successful move to London would end the dual structure of the business that has been in place since Unilever’s formation from the merger of a Dutch margarine company and British soap maker Lever Brothers more than 90 years ago.
However, hurdles remain. The unification plan must be approved by shareholders in Unilever’s UK operation, who are set to vote on the matter on October 12.
Meanwhile, growing political support for a Dutch law that would hit multinationals leaving the Netherlands with billions in exit taxes could scupper the plans.
Unilever, whose brands include Marmite, Dove soap and Ben & Jerry’s ice cream, has set a target date of November 22 for the unification.
The company has said a successful move to simplify its corporate structure would make equity-based acquisitions or disposals easier and faster.
Past disposals, such as the sale of Unilever’s spreads division, have been complicated by the need to unwind complex internal structures resulting from the dual domicile.
The company last month warned it would reconsider the plans to move if it was affected by the proposed Dutch tax bill, which has been designed to penalise companies with revenues of more than €750m that leave the Netherlands for lower-tax jurisdictions.
The proposed bill — nicknamed “Hotel California” after the Eagles’ song lyric “you can check out any time you like, but you can never leave” — could cost Unilever €11bn if it decides to move.
Tax has long played a role in Unilever’s attempts to simplify its corporate structure. The Dutch government tried to woo the group by scrapping a dividend tax on big companies, but retreated after a public backlash in 2018.
Unilever dropped its plans to consolidate its structure into a Rotterdam-based company two years ago, following pressure from shareholders. Its new idea to move to a London-based company was hailed by the UK government as a “vote of confidence” when first announced in June.
Unilever’s share price fell almost 2 per cent on Monday afternoon.
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