Classifieds | Archives | Jobs | About TGT | Contact | Subscribe
Last updated 4 minutes ago
Printer Friendly Version | TGT@Twitter | RSS Feed |
Unilever plans listing of new Dutch entity in December
September 13, 2018
 Print    Send to Friend

LONDON: Consumer goods giant Unilever laid out details for the planned December listing of its new Dutch entity, which has sparked criticism from some UK shareholders and become swept up in the debate over Brexit.

The maker of Dove soap, Lipton teas and Ben & Jerry’s ice cream has said ending its dual Anglo-Dutch structure is a purely Business move to improve corporate governance and make it more agile, particularly with regard to big mergers and acquisitions.

But the decision in March to make Rotterdam its main headquarters caused controversy in Britain, where opponents of Brexit warned it was a sign of Business losing faith in the country. Brexit supporters, meanwhile, pointed to Unilever’s ongoing commitment to its UK staff and operations.

The decision, which is pending shareholder approval, also faces pushback from some UK investors. It will likely see Unilever drop out of Britain’s blue chip FTSE 100 index, which could cause forced selling by UK funds mandated to track the index.

A promise by the Dutch government to scrap its 15 per cent withholding tax on dividends was seen as helping to sway Unilever to the Netherlands. Yet the promise faces opposition by domestic critics and has become a hot political issue.

Unilever unveiled a back-up plan on Tuesday which it can use in case the tax is not abolished or until it is repealed. It said it may use a dividend “substitution payment mechanism,” which involves distributing capital in a way that does not trigger the tax.

The move requires approval by 75 per cent of UK shareholders and 50 per cent of Dutch shareholders. The votes will take place on Oct. 25 in the Netherlands and Oct. 26 in London. Unilever has said it is “very confident” of securing the required votes.

If approved, one share in the capital of New Unilever NV would be issued for each share in the existing Dutch (NV) and UK (PLC) entities, resulting in shareholders receiving shares in the capital of New Unilever NV that represent an equivalent economic interest.

The expected last day of trading in NV and PLC shares would be Friday, Dec. 21, Unilever said. The simplification process would then complete over the weekend, with dealings in New Unilever NV shares starting on Monday, Dec. 24.

“Overall, we consider the proposed changes as value-enhancing for Unilever,” UBS analysts said in a research note.

Unilever launched a review of its dual structure in 2017 after fighting off a $143 billion takeover proposal from Kraft Heinz, triggering a battle between Britain and the Netherlands.

In March, the group said a new holding company, New Unilever NV, incorporated in the Netherlands, would be listed in London, Amsterdam and, in the form of American depositary shares, in New York.


Add this page to your favorite Social Bookmarking websites
Post a comment
Related Stories
Unilever sales below targets
LONDON: Unilever reported lower-than-expected fourth-quarter sales, hurt by troubles in Latin America (Latam) and weak growth in developed markets, showing the challenges..
Unilever, GSK in $3.8b deal
LONDON: Unilever is to buy GlaxoSmithKline’s (GSK) Horlicks nutrition business for $3.8 billion, boosting the Anglo-Dutch group’s position in India with the addition of t..
Unilever to engage more with shareholders
LONDON: Unilever will engage more with its shareholders and has learned lessons from investors’ opposition to the consumer goods group’s pay policy, a company executive s..
Unilever plans restructuring
LONDON: Unilever executives remain confident that shareholders will back a move to base a new single headquarters in the Netherlands as they launched a charm offensive to..
Unilever expects sales to improve in second half
LONDON: Unilever expects sales growth to accelerate in the second half of the year, as it pushes through price rises to offset higher commodity costs and wants to end its..
Advertise | Copyright