Unilever’s bid to end Anglo-Dutch dual-headed structure

Anglo-Dutch Unilever (UNA.AS) (ULVR.L) plans to become a single holding company based in Britain, unwinding a dual-headed structure which has been in place for 90 years.

Following are details of the consumer goods company’s plan, its rationale and reaction:

Unilever has been owned through two separately listed companies, a Dutch NV and a UK PLC, since it was set up in 1930 through the merger of Dutch margarine firm Unie and British soap maker Lever Brothers.

Unification would be achieved through a cross-border merger, with shareholders of Dutch Unilever NV getting one share in British Unilever Plc for each share held.

Unilever had planned to move its base to Rotterdam in 2018 under previous management, but this was thwarted by a revolt by British investors concerned that they would be liable for Dutch taxes on their dividends and also over the impact of a possible eviction from the FTSE 100 index of leading British shares.

Under the new plan, Unilever shares will retain a listing in Amsterdam as well as London and New York and the company expects to remain part of the AEX index of Dutch shares, meaning large Dutch institutions are likely to remain as investors.

Unilever, whose brands include Ben & Jerry’s ice cream, Lipton tea, Domestos bleach and Dove soap, says that the change will make the business easier to run and more agile when it comes to pursuing M&A or spinning off activities.

The original review that led to the plan rejected two years ago was spurred by an abortive $143 billion takeover approach by Kraft Heinz (KHC.O) in February 2017.

The company is at pains to stress that there will be no changes for its 6,000 staff in Britain and around 2,500 workers in the Netherlands.

Britain, which left the European Union earlier this year, welcomed the move as a “vote of confidence”, while the Dutch government expressed “regret”.

The Dutch government will miss out on revenue from a 15% tax that it had previously withheld on Unilever NV dividends — a sum of more than 300 million euros ($340 million) in 2019 — but it is not clear how much of that it retains on a net basis.

The head of the Dutch association for shareholders, Paul Koster, said the Netherlands risked being more exposed if Britain and its former EU partners failed to agree a trade deal.

“Many questions are still open regarding Brexit. What will happen with production locations? What influence will politics have?” Koster said.