THE SUNDAY TIMES: Unilever set to scrap historic dual listing: “The move would mimic the corporate revamp at Royal Dutch Shell, which was forced to abandon its dual listing last year after a scandal over its oil reserves triggered a shareholder revolt. Shell listed in London, but has its corporate headquarters in The Hague.”: Sunday 18 Sept 2005
Mark Kleinman
UNILEVER, the Anglo-Dutch consumer-goods giant, is considering scrapping its 75-year-old dual stock-market listing as part of a wide-ranging review of its corporate structure. The company’s chairman, Antony Burgmans, has asked the investment banks NM Rothschild and UBS to undertake a root-and-branch review of the group, which owns international household brands such as Dove shampoo, Flora margarine and Surf detergent.
People familiar with the situation say it is increasingly likely that Unilever, whose shares closed in London on Friday at 576½p, will merge its two operations. The new group will almost certainly be listed in London — a coup for the London Stock Exchange — but it is not clear where the head office would be located. Unilever currently has headquarters in London and Rotterdam.
A single listing in London would create a company with a market value of about £40 billion, analysts say, making it the ninth largest on the London exchange.
The move would mimic the corporate revamp at Royal Dutch Shell, which was forced to abandon its dual listing last year after a scandal over its oil reserves triggered a shareholder revolt. Shell listed in London, but has its corporate headquarters in The Hague.
Burgmans, who is due to leave Unilever in 2007 but may step down sooner if a replacement is found, was handed the task of overseeing the review earlier this year.
The company is battling against slow growth in many of its core businesses. Unilever’s board is concerned that its unwieldy structure is distracting attention from the drive to kick-start top-line growth and improve the company’s operating margins.
“With regard to the review of our corporate structure, our current arrangements have served us well,” Burgmans said earlier this year. “Nevertheless it is now appropriate to review whether they will continue to do so into the future.”
A unification of the company’s stock-market listings would be the most significant corporate action in Unilever’s long history. This year the company swept away its dual board structure and appointed a single non-executive chairman, Burgmans, and chief executive, Frenchman Patrick Cescau.
Unilever declined to comment on the appointment of advisers or on the progress of the review. Burgmans will report his findings to the company’s annual meetings in Britain and the Netherlands next year. Rothschild was an adviser on Shell’s restructuring last year. Citigroup was another.
On Friday, Unilever confirmed a recent report in The Sunday Times that it is to make a strategic review of its frozen-food arm, which includes the Birds Eye brand.
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