As blue-chip stalwart prepares for crunch vote on abandoning Britain, it’s…D-day for Unilever


As blue-chip stalwart prepares for crunch vote on abandoning Britain, it’s…D-day for Unilever

James Burton For The Daily Mail

Investors will be asked within days to decide whether Unilever should shift its legal base abroad – ending its decades-long status as a stalwart of London’s blue-chip index.

Shareholders will receive documents on Tuesday setting out the fine detail of a plan to axe the dual Rotterdam and London headquarters that have existed since the consumer goods group was formed by an Anglo-Dutch merger 89 years ago.

Instead chief executive Paul Polman wants the firm – which makes everything from Magnum ice creams to Dove deodorant – to have to have a single legal headquarters in Rotterdam. The move is aimed at simplifying the company, which is listed on both the British and Dutch stock exchanges.

But it will mean Unilever will not feature in the FTSE 100 list of the UK’s biggest public companies for the first time since the index launched in 1984.

Many major British investment companies are only allowed to buy Footsie stocks, including pension funds looking after millions of pounds of savers’ cash, meaning they will have to shed their Unilever stakes.

The move has infuriated many top shareholders who want to hold onto their investment.

It has set the stage for a bitter public battle over 62-year-old Dutchman Polman’s plan.

Half of investors who hold stakes through the Dutch stock market must give their approval and are widely expected to do so. But Polman also needs support from 75 per cent of shareholders who own their shares through the London Stock Exchange in a vote next month. It is thought more than 25 per cent of the those investors could be forced to sell Unilever stakes if the rules were introduced – potentially enough to defeat the proposal if they all vote against it. And at least one major shareholder is considering just that.

Another, Columbia Threadneedle, has raised concerns.

In March its head of responsible investment Iain Richards said: ‘They (Unilever) need to do more to convince UK shareholders of the merits of the move.’

Signing off?: Shareholders will receive documents setting out the plan to axe the dual Rotterdam and London headquarters

Signing off?: Shareholders will receive documents setting out the plan to axe the dual Rotterdam and London headquarters

Signing off?: Shareholders will receive documents setting out the plan to axe the dual Rotterdam and London headquarters

Father-of-three Polman claims the decision will improve corporate governance and accountability. But critics argue Polman wants to move to the Netherlands to make it harder for predators to take over the consumer goods giant. Unilever fought off a hostile bid by US food firm Kraft last year in a bruising battle that executives do not want to repeat.

If shareholders foil the plan it will be a crushing blow for Polman, who was paid £10.4m last year. Shares rose 0.5 per cent, or 21.5p, to 4245p.

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