Royal Dutch Shell said it would scrap its dual share structure and move its head office to Britain from the Netherlands, pushed away by Dutch taxes and facing climate pressure in court as the energy giant shifts from oil and gas.
The company, which long faced questions from investors about its dual structure and had recently been hit by a Dutch court order over its climate targets, aims to drop “Royal Dutch” from its name – part of its identity since 1907 – to become Shell Plc.
The firm has been in a long-running tussle with the Dutch authorities over the country’s 15pc dividend withholding tax on some of its shares, making them less attractive for international investors. Shell introduced the two-class share structure in 2005 after a previous corporate overhaul.
The new single structure with all shares under British law means none of its shares would be under this tax. It would also allow Shell to strike swifter sale or acquisition deals.
In a further knock to its relations with the Netherlands, the biggest Dutch state pension fund ABP said last month it would drop Shell and all fossil fuels from its portfolio.
The Dutch government said it was “unpleasantly surprised” by Shell’s plans to move to London from The Hague.
The decision will, however, be seen as a vote of confidence in London after Britain’s exit from the EU triggered a shift in billions of euros in daily share trading from the UK capital to Amsterdam.
Shell’s shares, which will still be traded in Amsterdam and New York under the plan, climbed more than 2pc in London on Monday morning after the news.
“The current complex share structure is subject to constraints and may not be sustainable in the long term,” Shell said.
The dual structure means Shell now has primary listings in both London and Amsterdam, as well as two overarching legal headquarters despite operating as one economic group. Such set-ups are expensive and complex, requiring the replication of board-level functions in two jurisdictions as well as being incorporated under two different legal regimes.
The change requires at least 75pc of votes by shareholders at a general meeting to be held on December 10, the company said.
Shell has said it would return $7bn (€6.15bn) from selling US assets to ConocoPhillips in addition to an ongoing share buyback programme.