Unilever unifies Dutch and UK sides to fight P&G juggernaut

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The Independent Online

Unilever is to go through a radical shake-up, reforming the dual Anglo-Dutch structure and creating a single company.

Unilever is to go through a radical shake-up, reforming the dual Anglo-Dutch structure and creating a single company.

The overhaul will be announced on 10 February, when the ice cream-to-shampoo giant reveals its full-year figures, and will be flagged as putting Unilever in a better position to compete with the new Procter & Gamble/Gillette titan.

Unilever's joint chairmen, Patrick Cescau and Antony Burgmans, will change roles, with Mr Burgmans becoming executive chairman in charge of strategy and Mr Cescau chief executive running the day-to-day operations. When Mr Burgmans retires in 2007, he will be replaced by a non-executive chairman.

Unilever will confirm it is to operate with a single board, something that has in effect been the case since it announced that the non-executive directors of the UK board would be the same as the appointed directors on the Dutch board.

The group will say it plans to unify its two headquarters - in Rotterdam and London - and set up one HQ. There is disagreement about where this should be based, with the Dutch arm pressing strongly for Rotterdam. Unilever is to say it will consult with "stakeholders" about how best to proceed.

These stakeholders will include the Dutch and British governments, and employees as well as shareholders. Major investors have made it clear they want Unilever to merge its operational businesses into one.

There are also suggestions that Unilever could merge its legal entities and share structures, though this is complex and will be considered only when the operational changes are completed.

Two factors are behind the shake-up. The first is Unilever's underperformance in the past couple of years since its "Path to Growth" strategy started falling apart. The second is Proctor & Gamble's $57bn (£30bn) takeover of Gillette, which creates a group more than twice Unilever's size.

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