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Wednesday 23 January 2019

Unilever picks Rotterdam over London for HQ in blow for Brexit Britain

The decision is likely to cause further embarrassment for the Conservatives and Prime Minister Theresa May.

Unilever has chosen Rotterdam over London (PA)
Unilever has chosen Rotterdam over London (PA)

By Ravender Sembhy, Press Association City Editor

Unilever has confirmed that it has chosen Rotterdam over London as its new legal headquarters, dealing a major blow to the UK Government as it tries to uphold Britain’s status as a centre for business after Brexit.

Following a board meeting on Wednesday, the consumer goods giant said that it intends to “simplify” from two legal entities into a single one incorporated in the Netherlands.

“The proposed simplification will provide greater flexibility for strategic portfolio change and help drive long-term performance,” the group said.

Unilever insisted that its 7,300 workers the UK and 3,100 in the Netherlands will be unaffected by the changes.

Unilever has today shown its long-term commitment to the UK by choosing to locate its two fastest-growing global business divisions in this country Government spokesman

It added that Unilever will continue to be listed in London, Amsterdam and New York.

The announcement comes after a review of Unilever’s dual-headed legal structure in the UK and Netherlands, which was part of a rethink of the business following a hostile takeover attempt by Kraft Heinz last year.

Unilever, which is behind well-known household brands such as Dove, Marmite and Ben & Jerry’s ice cream, employs around 169,000 people around the world.

Unilever executives claimed that the move to Rotterdam has “nothing to do with Brexit,”  but the decision will cause embarrassment for the Conservatives and Prime Minister Theresa May, who is struggling to contain a flow of businesses and their staff to the EU.

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.

The Government is already under fire for failing to provide adequate assurances to businesses mulling their post-Brexit futures, particularly in light of plans to leave the EU single market.

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The company confirmed that only a “minimal” number of people would move from Unilever House in London to the Dutch city.

A Government spokesman said: “Unilever has today shown its long-term commitment to the UK by choosing to locate its two fastest-growing global business divisions in this country, safeguarding 7,300 jobs and £1 billion a year of investment.

“As the company itself has made clear, its decision to transfer a small number of jobs to a corporate HQ in the Netherlands is part of a long-term restructuring of the company and is not connected to the UK’s departure from the EU.”

As part of the rejig,  Unilever will also restructure into three divisions – beauty and personal care, home care, and foods and refreshment – which will each have different headquarters split between the UK and the Netherlands.

The beauty and personal care, and the home care divisions will be headquartered in London, while the foods and refreshment arm will have its HQ in Rotterdam.

Unilever chairman Marijn Dekkers said: “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.”

Its announcement also comes amid speculation over the timing of chief executive Paul Polman’s retirement, with reports last autumn suggesting a search for his successor had already begun.

Unilever last month reported a 9% increase in annual profits to 8.15 billion euro (£7.1 billion), having been boosted by a strong performance in emerging markets.

The group fended off a 143 billion US dollar (£115 billion) takeover attempt from Kraft Heinz last year, after which it offloaded its spreads business for 6.8 billion euro (£6 billion) to KKR.

Press Association

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