Holding Company designs the portfolio
Franz Haniel & Cie. GmbH is a tradition-steeped German family-equity company whose objective is to sustainably increase the value of its investment portfolio over the long term. Since the family shareholders have provided equity for an unlimited term, Haniel pursues a long-term investment strategy. This strategy is aimed towards generating returns which permanently exceed the cost of capital. In so doing, Haniel is attempting to harmonise this economic goal with ecological and social goals. The Company is pursuing this goal by following the guiding principal of the “honourable businessman”. At Haniel, capital and management are separated as a matter of principle: Although the Company is 100 per cent family owned, no member of the Haniel family works at the company.
When structuring the portfolio, Haniel concentrates on business models that are supported by global megatrends and therefore have a high potential for increases in value over the long term. Promising markets and business models are analysed continually in order to detect growth opportunities. Haniel strives to reach a leading market position in all divisions. Its strategy also includes the disposal of divisions if Haniel has exhausted the potential to increase value or Haniel is no longer the best owner. For this reason Haniel decided to sell the Celesio division to McKesson, the leading North American healthcare services company. The transaction was successfully completed in February 2014.
In addition to portfolio management, the Haniel Holding Company’s task is to create the range of actions permitted for the operating divisions – in this respect the Holding Company considers itself to be a strategic catalyst. Significant strategic thrusts and initiatives are agreed on in discussion with the divisions, which are then implemented by the divisions under their own responsibility. The Haniel Management Board regularly discusses the progress with the divisions’ management. The Haniel Holding Company is also responsible for selecting and developing top executives for the divisions and offering the divisions tools and selected services. This ensures that all divisions use their respective business models to contribute to the value enhancement of the investment portfolio in the best manner possible.