Unilever Headquarters Combination Cleared by U.K. Shareholders
(Bloomberg) - Shareholders in the UK branch of Unilever voted overwhelmingly in favor of unifying the company's UK headquarters, moving the Dove soapmaker's plan to end dual nationality one step closer to completion.
More than 99% of the UK company's investors voted in favor of the move at a general meeting on Monday, which was an earlier approval rating from Dutch investors. The decision drives a plan to streamline a cumbersome structure that has made major acquisitions and divestitures difficult.
The owner of Knorr Stock Cubes and Ax shower gel has retained two bases since the merger of Margarine Unie from the Netherlands and British soap maker Lever Brothers in 1930. After an unsolicited takeover approach by Kraft Heinz Co. in 2017, this structure began to develop.
The move to a single headquarters has led to speculation that Unilever would step up its merger and acquisition activities. The company conducted a strategic review of its tea business following the sale of its Spreads unit and the acquisition of consumer health brands in South Asia from GlaxoSmithKline Plc.
The vote gives Chief Executive Officer Alan Jope a victory after the company withdrew a proposal to unify its business in the Netherlands under his predecessor Paul Polman. This reversal came after UK shareholders rebelled against the company's possible exit from the FTSE 100 index.
Unilever's streamlining plan still faces a potential hurdle in the form of a so-called exit tax proposed by the Green Party of the Dutch opposition. The company has announced that the plan would make moving to London prohibitively expensive, but the legislation is in its early stages.
The tax proposal would violate EU laws on freedom of establishment and free movement of capital and the tax treaty between the UK and the Netherlands, Unilever said.
The likelihood that Unilever's Dutch and UK share classes will be unified has dropped from 80% to 90% to 65% to 75%, Barclays analysts said in a note, citing the Greens' determination to vote on the tax.
Unilever's shares, traded in London, were barely changed on Monday afternoon.
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