Unilever (LON:ULVR) has told investors that it is ‘extremely unlikely’ that it will retain a position in the blue-chip FTSE 100 index after it abandons its corporate base in London, The Times has reported. The Anglo-Dutch consumer goods giant recently picked Rotterdam over the UK capital for its single corporate base as part of its efforts to simplify its structure in the wake of Kraft-Heinz’s failed bid.
Unilever’s share price has advanced in London this morning, having gained 0.92 percent to 4,070.50p as of 10:24 BST. The stock is outperforming the broader UK market, with the FTSE 100 index currently standing 0.66 percent lower at 7,714.26 points. The group’s shares have lost more than four percent of their value over the past year, as compared with an over four-percent rise in the benchmark index.
Unilever to lose FTSE 100 spot
The Times reported this morning that Unilever’s chief financial officer Graeme Pitkethly had said that while the group had had held extensive talks with FTSE Russell, the index operator, it was not expected to remain eligible for inclusion in the FTSE UK series of indices after it abandons its London base. Consequently, the consumer goods group’s weighting in the pan-European blue-chip index Euro Stoxx will increase.
“We understand and appreciate that a departure from the FTSE index has negative implications for some investors that are benchmarked to it,” Pitkethly pointed out, adding that the company “would hope those investors who are impacted have sufficient flexibility in their portfolios to continue to hold Unilever”.
Analysts on Anglo-Dutch group
Goldman Sachs, which sees Unilever as a ‘neutral,’ set a price target on the shares of 4,000p yesterday, while earlier this month, BNP Paribas, which has a ‘buy’ rating on the stock, set a valuation of 4,800p. According to MarketBeat, the Anglo-Dutch consumer goods giant currently has a consensus ‘buy’ rating and an average price target of 4,403.53p.