Family squabbles are threatening the future expansion of one of Germany’s largest family-owned companies, Tchibo, culminating as they did on Wednesday (10 January) in the resignation of CEO Gunter Herz.
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The head of the enterprising Herz family, 60 year-old Gunter blamed an “irreparable breakdown in trust” for his departure from the helm of the coffee, cigarette and cosmetics group after 35 years. He said he would leave the company on 31 January, and as yet no successor has been named.
Even some of the senior managers at the Hamburg-based company failed to realise that difficulties between Herz and the supervisory board, controlled by his relatives, had deteriorated so badly.
Tchibo, which posted revenue before cigarette tax of DM19.1bn in 1999, controls the lucrative Reemtsma, Germany’s second largest tobacco group, a 26% stake in cosmetics group Beiersdorf (which produces the Nivea range) and the largest chain of coffee outlets in the country.
As coffee business margins were seen declining however, and industry watchers argued for the need for a parent to expand the cigarettes business beyond Germany, it was apparent that Tchibo needed strong leadership and direction. For the time being it has neither.
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By GlobalData
