Unilever’s UK shareholders have voted overwhelmingly in favour of plans to move the Marmite owner's legal base to London, despite warnings that a vote on a proposed exit tax if it leaves the Netherlands could go down to the wire.
The shift to a single legal headquarters in Britain was backed by 99.5pc of voting investors at a meeting on Monday, bringing the firm one step closer to abandoning its dual-headed Anglo-Dutch structure after 90 years.
Dutch investors in Unilever, which also owns Dove soap and Ben & Jerry’s ice cream, approved the move with 99.4pc support last month.
But analysts warned that Unilever's proposals may yet be derailed by the plans for a Dutch exit tax, which could cost the firm €11bn.
Legislation proposed by the opposition GreenLeft (GroenLinks) party would impose a levy on firms with annual revenues of more than €750m that relocate their headquarters abroad in an effort to prevent large companies from leaving Holland.
Warren Ackerman, an analyst at Barclays, said overwhelming shareholder support for the plans may help the Green Party whip up support as it attempts to win backing for the proposal".
Chief executive Alan Jope has admitted Unilever could cancel the merger up to the moment it is approved by the High Court approval if the law is passed.
On Friday, the Netherlands’ Council of State ruled that the tax proposals are “legally not tenable” and “irresponsible”, recommending they should not proceed to a debate in parliament.
But Mr Ackerman said that despite this negative legal advice, the Green Party is pressing on and is likely to pursue a date for a debate.
He added that Unilever is likely to be concerned if a date is set and a vote scheduled, given increased momentum around support for the bill.
Mr Ackerman said: “While the State Council has clearly raised legal challenges to the bill, it could still garner populist support by other political parties especially given upcoming Dutch elections in early 2021.
“It could go down to the wire and it is not impossible that the Green Party may be close to getting the majority it needs.”
Barclays has now lowered its probability of unification succeeding to 65 to 75pc, down from 80 to 90pc previously forecast.
It estimates that pro-tax parties can muster 57 votes in the Dutch Parliament. They would need 76 to get the law through.
A UK high court meeting to ratify that the pre-merger steps have been completed is set for Oct 23, with a final court date on Nov 2 to approve the unification.
Mr Ackerman said Unilever's board could find itself in "a tricky position" if the vote takes place after these key legal dates.
He said: "Ideally it [Unilever] would want to know the result of any vote before it sits down with the UK high court on Oct 23 but it may well be in a position where it doesn’t have a clear view of the situation in the Netherlands."