Unilever agrees settlement
Unilever NV today announced that it has agreed a settlement with the main parties in the legal dispute over its 1999 Unilever NV Preference Shares. These parties, with whom constructive talks have been held, include the Dutch Shareholders Association, VEB, and several institutional shareholders.
Unilever NV will pay an amount of € 1.38 (plus interest of € 0.16) compensation per Preference Share held at the beginning of 24 March 2004, the day on which Unilever NV announced its intention to convert the Preference Shares into NV Ordinary Shares. Unilever NV also agreed to reimburse the VEB and the other parties who initiated the Enterprise Chamber procedure for costs and expenses.
The agreement is subject to the requirement that all Preference Shareholders who requested the Enterprise Chamber of the Amsterdam Court of Appeal to order an inquiry join in the agreement. It also includes a term that the signatories will no longer take legal action against Unilever.
The offer will be extended to all those other former Preference Shareholders who held Preference Shares at the beginning of 24 March 2004.
Payment is expected to be made as from 1 February 2007.
The settlement follows publication on 8 September 2006 of the report of the investigators appointed by the Enterprise Chamber. The criticisms made in the report related to communications but did not extend to Unilever's decision to convert the Preference Shares into Ordinary Shares in 2004 which was acknowledged to be correct.
The Unilever Board set up a Board Committee composed of independent non-executive Board members and chaired by Professor Wim Dik to deal with the matter. The Committee, which was supported by external legal advisers, considered the matter carefully and recommended that the Unilever Board settle the dispute with those who held the Preference Shares at the beginning of 24 March 2004.
The Board agreed with the recommendation, concluding, without any admission of liability, that it is in the best interest of Unilever and its shareholders to settle this issue rather than enter into potentially lengthy and uncertain litigation.
It cannot be excluded that, notwithstanding this settlement agreement, other former Preference Shareholders may still take legal action. If so, Unilever is confident about the strength of its legal position vis-à-vis those parties.
Unilever previously announced a provision of € 300 million for possible compensation along with its Q3 results.
This announcement today does not yet constitute an offer to the eligible former Preference Shareholders. The offer, including further details such as information on the duration of the offer and other conditions, will be made public in the short term.
This announcement may contain forward-looking statements, including 'forward-looking statements' within the meaning of the United States Private Securities Litigation Reform Act of 1995. Words such as ‘expects’, ‘anticipates’, ‘intends’ or the negative of these terms and other similar expressions of future performance or results and their negatives are intended to identify such forward-looking statements. These forward-looking statements are based upon current expectations and assumptions regarding anticipated developments and other factors affecting the Group. They are not historical facts, nor are they guarantees of future performance. Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements, including, among others, competitive pricing and activities, consumption levels, costs, the ability to maintain and manage key customer relationships and supply chain sources, currency values, interest rates, the ability to integrate acquisitions and complete planned divestitures, physical risks, environmental risks, the ability to manage regulatory, tax and legal matters and resolve pending matters within current estimates, legislative, fiscal and regulatory developments, political, economic and social conditions in the geographic markets where the Group operates and new or changed priorities of the Boards. Further details of potential risks and uncertainties affecting the Group are described in the Group’s filings with the London Stock Exchange, Euronext Amsterdam and the US Securities and Exchange Commission, including the Annual Report and Accounts on Form 20-F. These forward-looking statements speak only as of the date of this document. Except as required by any applicable law or regulation, the Group expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Group’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.