The Amsterdam commercial court has ordered a special investigation into Unilever's treatment of its preference shares that could force the Anglo-Dutch food-to-detergents group to pay out to disgruntled investors.

Last March, Unilever said it planned to convert the 1999 Dutch cumulative preference shares into ordinary stock, but some holders said the company had given the impression in the past that it would buy them back for €6.58 per share.

Analysts have estimated that a cash payment could cost Unilever about €1.4 billion, while its planned share conversion was worth €1 billion.

The court said three investigators would look into the matter following a legal case brought by a group of individual investors, wealth managers, and Dutch and foreign pension and investments funds.

In another test of Dutch corporate governance, the commercial court will decide next month whether to order a special investigation into management at retailer Ahold at the request of shareholders who lost money when the stock plunged after a 2002 book-keeping scandal.

The VEB shareholders group, one of the plaintiffs in the Unilever case which represents a quarter of the preference shareholders, said it was "pleased" about the ruling and felt supported in the opinion that the company had been "severely deficient" in the way it informed investors.

VEB said the preference shareholders stood to lose out on €465 million if the stock was converted instead of redeemed in cash.

The Dutch preference shares had been issued as part of a special tax-free dividend of €6.58 in 1999, and Unilever planned to convert them into a maximum of 18.9 million ordinary shares in the first quarter of 2005.

In a statement, the company said it was "fully co-operating" with the court.

In the 29-page ruling, read out by court president Mr Huub Willems, the court found that Unilever's communication with investors and analysts had been less than optimal in respect of the preference shares.