Unilever announced plans in March to consolidate its headquarters to Rotterdam, but investors warned that British shareholders could sell off shares in response.
UK regulations would have prevented the company from trading on the FTSE had the proposals been approved, sparking concerns of share sell-offs from some investors.
The company stated that proposals to simplify Unilever's dual-headed legal structure initially received widespread support, but a significant group of shareholders protested it, causing the withdrawal.
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"The Unilever Board has today decided to withdraw its proposal to simplify Unilever's dual-headed legal structure," a Unilever spokesperson said in a statement, adding that the board wanted a "stronger, simpler and more competitive Unilever" for its shareholders' long-term success.
"The Board continues to believe that simplifying our dual-headed structure would, over time, provide opportunities to further accelerate value creation and serve the best long-term interests of Unilever," Unilever chairman Marijn Dekkers said.
Dekkers also said that Board members will consider the next steps and would continue to engage with shareholders, adding that the company will proceed with plans to cancel its NV preference shares to strengthen corporate governance.
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Some Twittizens responded to the decision by tweeting their two cents to followers, manning both sides of the Brexit argument.
Kevin Maguire, Associate editor for Daily Mirror, tweeted that Unilever's decision had nothing to do with Brexit and was more concerned about protecting the company from "financial raiders".
Unilever HQ leaving Britain never about Brexit and nor is staying. Anglo-Dutch company worried about lack of protection from financial raiders. Shareholders want it to stay…to cash in from raids
— Kevin Maguire (@Kevin_Maguire) October 5, 2018
London mayor Sadiq Khan tweeted his elation about Unilever's decision while taking the chance to criticise the UK government's ‘appalling' mishandling of Brexit negotiations.
It’s great news that @Unilever has chosen to keep its HQ in London & abandoned plans to move it to Rotterdam.
— Sadiq Khan (@SadiqKhan) October 5, 2018
Despite the Govt's appalling mishandling of the Brexit negotiations, the capital will always be one of the best cities in the world to do business.#LondonIsOpen https://t.co/ooOkeXGGga
An interesting question from @George_Osborne from March… “if Unilever had chosen Britain instead of Holland do you think it would have been saying Brexit had nothing to do with it?” pic.twitter.com/67zIW8IC8E
— Harry Cole (@MrHarryCole) October 5, 2018
The Remain campaign loved this one. This morning? Not so much.
— Darren Grimes (@darrengrimes_) October 5, 2018
Unilever scraps plan to move HQ from London after huge investor backlash: Unilever's decision to remain in the FTSE 100 will be seen as a boost for the London stock market: https://t.co/MFMLMhSSGq
Unilever is the merger of Dutch margarine company Unie and British soap makers Lever Brothers, which formed a dual-headed company structure in 1930. The company produces diverse products such as Pot Noodle, Knorr seasonings, Axe, Ben & Jerry's ice cream, among others, and is one of Britain's biggest FTSE 100 index firms worth £124 billion.
