Another top-10 Unilever shareholder declared its opposition to the group's proposal to base a new single headquarters in the Netherlands, becoming the fifth big investor to publicly criticise the board's plan.
Legal & General Investment Management, one of Europe's largest asset managers, on Friday said it intended to vote against Unilever's proposed move next month.
"We understand Unilever has explored a number of alternatives in reaching its final decision. However, we do not believe Unilever has made a compelling case for many PLC shareholders to support the recommendation in favour of Dutch incorporation," Sacha Sadan, director of corporate governance at LGIM, said in a statement.
LGIM said it worked with the Investor Forum on this issue.
Members Have Escalated Concerns
The Investor Forum - a nonprofit group that facilitates engagement between UK companies and institutional investors - confirmed that 'members have escalated concerns regarding Unilever' and that it 'has engaged, on their behalf, with the company'.
LGIM is the sixth-biggest shareholder in Unilever PLC, with a 1.98% stake, according to Reuters data. The group has total assets of £984.8 billion (€1.10 trillion) under management.
It follows Lindsell Train, Columbia Threadneedle, M&G Investment Management and Aviva Investors Global Services in voicing dissatisfaction with the proposal. Together, the five investors control 7.41% of Unilever's UK-listed shares.
Approval From Shareholders
Two main practical concerns are around the forced selling of Unilever shares by some British investors because Unilever will drop out of the benchmark FTSE 100 index, and the future tax treatment of Dutch dividends.
In order for the proposal to pass, it needs approval from a majority of shareholders, who control at least 75% of the UK shares. It only needs approval from 50% of the Dutch shares.
Earlier this week, the maker of Ben & Jerry's ice cream and Dove soap launched a media charm offensive aimed at bringing shareholders on side.
Sky News on Friday reported that several large institutional investors are drawing up plans to oppose the re-election of Unilever Chairman Marijn Dekkers next year.
News by Reuters, edited by ESM. Click subscribe to sign up to ESM: European Supermarket Magazine.