Anglo-Dutch food and consumer goods giant Unilever is set to choose London for its global headquarters, according to the Independent on Sunday newspaper.

The group has been reviewing how it will operate ever since it confirmed earlier this year that it was to give up the Anglo-Dutch dual structure it has worked under for more than 70 years the paper said.

Outgoing chairman Antony Burgmans is leading a review of Unilever's corporate structure, while chief executive Patrick Cescau is integrating the day-to-day running of the group.

Burgmans is understood to have concluded that the group's legal domicile should be in the Netherlands, which has a far more favourable tax regime than the UK. It had been widely assumed that Unilever's global headquarters would also be in the Netherlands, in Rotterdam.

However, The Independent on Sunday said it had learnt that Cescau has effectively lobbied for the headquarters to be in London. This is likely to cause a political row in the Netherlands, where the loss of Unilever's head office will be seen as a blow to national pride, the paper said. When Royal Dutch Shell and Shell Transport & Trading merged earlier this year, the headquarters of the combined group went to The Hague, the Dutch capital.

Unilever will move into Lever House, overlooking Blackfriars Bridge in central London, a listed 1930s building with lifts decorated by the sculptor Eric Gill, which is currently being redeveloped and will reopen next year.

Rotterdam will become the regional headquarters for Unilever's European operations. These have been under pressure because of the trend towards low-cost supermarkets, such as Lidl and Aldi, selling no-brand products. This had led Cescau to prune the group's portfolio further, putting its frozen foods business up for sale last month.

Burgmans is understood to be in favour of proposals put forward by the group's investment banking advisers, NM Rothschild and UBS, to combine Unilever's two classes of shares into one stock, listed in London. This would bring a one-off technical boost to the share price and increase the weighting UK investors have to give it in their portfolios. This would outweigh any selling of shares by Dutch investors.

A Unilever spokesman denied that a decision had been made about where the group's headquarters would be. "The review is continuing and we will announce its results when it is ready," he said.