Unilever "broke its promise": The food business headquarters abandons the Netherlands to set up in the United States, turning past commitments into empty words

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This image pertains to a promise made by AI five years ago to the Dutch government, which has now been personally overturned by Unilever.

According to reports, this British-Dutch consumer goods giant recently announced that it would merge its food business with U.S. condiment company Best Foods, with the new company’s global headquarters set in Maryland, USA, rather than the previously promised Netherlands. This decision has been directly called out as “being played” by Dutch media.

The $44.8 billion deal was finalized at the end of March. According to the agreement, Unilever will spin off well-known food brands such as Knorr, Hellmann’s, and MaMaMia, and merge its spice and seasoning business with Best Foods, forming a “global seasoning giant” with annual revenue of about $20 billion.

After the deal closes, Unilever and its shareholders will hold 65% of the combined company and receive $15.7 billion in cash. However, the new company will be managed by the original Best Foods team, will retain the “Best Foods” name, and will have its global headquarters in Hunt Valley, Maryland, USA, with an “International Headquarters” established in the Netherlands.

This arrangement starkly contrasts with the commitments made by Unilever in 2020. At that time, Unilever decided to move its global headquarters from Rotterdam, Netherlands, to London, UK, which provoked strong dissatisfaction in the Netherlands. To quell the controversy, Unilever’s board sent a formal letter to the Dutch Minister of Economic Affairs and the Minister of Finance, explicitly promising that if its food business was split in the future, its headquarters would be in the Netherlands and it would be listed locally. This letter was seen as a “peace of mind” guarantee to soothe Dutch government and public sentiment, but it also left a “back door”—on the condition that the Netherlands continued to maintain its advantageous position as a corporate headquarters location.

Now, five years later, Unilever CEO Fernando Fernandez is vigorously pushing the company’s strategic transformation, shifting focus from food to high-growth sectors like beauty, health, and personal care. The divestment of the food business is the “final step” in this strategy. But at the operational level, Unilever chose to merge with Best Foods rather than spin off the food business independently. This move cleverly bypasses the earlier commitment, because legally, it’s a “merger” rather than a “split,” and the promise from back then seems no longer binding.

The Dutch side naturally isn’t convinced. After all, Unilever was formed in 1930 through the merger of the Dutch Margarine Union and the British Lever Brothers, with nearly a century of roots in the Netherlands. Now, with the food business headquarters moved to the U.S., what remains of Unilever in the Netherlands are only the R&D center in Wageningen and the ice cream business that went public last year, headquartered in Amsterdam.

Market reactions to this “breach of promise” also seem less than enthusiastic. After the deal was announced, Unilever’s stock price dropped over 7%. Investors are worried not only about integration risks but also about potential selling pressure from the new company due to high debt levels and the fact that it is only listed mainly in New York. Some analysts commented, “In our view, this is not a smooth execution.”

From the Dutch government’s perspective, this is undoubtedly a diplomatic and commercial double setback. Their earlier efforts to retain this flagship company through tax law modifications now appear to have been completely thwarted. Meanwhile, Unilever has used a promise letter with “conditions” attached to pave the way for today’s “breaking of promises.” Perhaps this reflects the true choice multinational corporations face between national interests and capital logic: commitments can be written into letters, but ultimately, the decision on where to go depends on the numbers on the ledger.