In a major setback for the UK government, Unilever plc (UL) said it is planning to consolidate its headquarters in the city of Rotterdam in the Netherlands instead of London. The consumer goods giant currently has two operating companies in the Netherlands and the UK with the two boards following different regulations in each country. Unilever said its decision to base its headquarters in Rotterdam instead of London is not related in any way to Brexit although this move is likely to impact the UK in terms of investment.
Unilever said it had chosen Rotterdam plainly due to the fact that the Netherlands entity was larger than the British one. The Dutch company holds about 55% of the combined share capital and has more trading liquidity than its UK counterpart.
Unilever plans to restructure its operations more broadly into three divisions, each with its own headquarters. The company plans to base its beauty and personal care division as well as its home care division in the UK. The foods and refreshment unit will be based in Rotterdam.
Meanwhile, the company plans to continue investing in the UK on research and development. There will be no significant impact on jobs in both countries due to the latest decision.
The new structure is expected to provide Unilever with greater flexibility in making changes to its portfolio and in taking major decisions related to mergers and acquisitions.
Shares saw a slight drop in both London and Netherlands.
Although Unilever has denied that its decision has any connection to Brexit, one of the problems facing the UK is the likelihood of many large companies shifting base to the European Union for simplicity of doing business. This will have a negative impact on the UK economy.
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