A top-five shareholder in Unilever (LON:ULVR) has warned of the forced selling of the consumer giant’s shares over the group’s decision to move its headquarters to the Netherlands, the Financial Times has reported. The news comes after the Anglo-Dutch company recently told investors that it was ‘extremely unlikely’ that it will retain a position in the blue-chip FTSE 100 index after it abandons its corporate base in London.
Unilever’s share price has climbed into positive territory, having gained 0.36 percent to 4,189.50p as of 10:28 BST, marginally underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.66 percent higher at 7,641.70 points. The group’s shares have lost more than one percent of their value over the past year, as compared a near three-percent gain in the Footsie.
Dutch move concerns
The Financial Times reported today that Nick Train, joint founder of Lindsell Train, a top-five shareholder with a 2.5-percent stake in Unilever, had urged holders of the group’s UK-listed shares to “give serious consideration over the summer as to whether the proposal is in their interest”. The Anglo-Dutch group has picked Rotterdam over London for its single corporate base as part of its efforts to simplify its structure in the wake of Kraft-Heinz’s failed bid.
A top-10 shareholder, who has spoken with the board twice about the plans, further told the newspaper that Unilever had been ‘almost belligerently unreceptive’ to the concerns of British investors. The vote on the move is due to take place before the end of September.
The FT notes that passively managed funds using the FTSE 100 as their benchmark will be forced to sell their shares if the company is ejected from FTSE Russell UK indices, and that some active fund managers fear that the forced selling of stocks could drive down Unilever’s share price.
Analysts on Unilever
Barclays, which sees the Anglo-Dutch group as a ‘buy,’ set a price target of 4,630p on the shares last week. According to MarketBeat, the company currently has a consensus ‘buy’ rating and an average price target of 4,405.88p.