JAB Holding

A hands-off investment strategy pays off for Mittelstand's JAB

Inside The Roastery Lab by Coffee Academics Research and Development Facility
Black, like JAB's bottom line. Source: Bloomberg

No wealthy German family is both as ambitious and reclusive as the Reimanns, heirs to a multi-billion chemical fortune. Since 2012, their JAB holding company has invested €14 billion ($16.8 billion) in a global coffee and coffeehouse empire that rivals Nestlé and Starbucks, acquiring brands including Krispy Kreme, Douwe Egberts and Heurig. And the family has followed a strategy rare amongst its German Mittelstand peers – by taking a passive, hands-off approach that relies on professional managers rather than multi-generational familial meddling.

Their JAB holding, an investment vehicle sporting the initials of the founding patriarch, is run by three co-managers: veteran Reimann manager Peter Harf, ex-Mars executive Olivier Goudet and chairman Bart Becht. As well as chairing JAB, Mr. Becht is chairman of beauty products giant Coty and former CEO of pharmaceutical group Reckitt Benckiser, both at least partially owned by JAB. The holding is so successful that it is now essentially an investment fund and is on the hunt for outside capital to help fuel the company’s next stage of growth. “Our transactions are getting bigger and bigger, and we need more money,” Mr. Becht said in a Handelsblatt interview.

In 2012, the family handed discretionary power to the three co-managers to run JAB as they saw fit. Since then, the business has moved to Luxemburg for tax reasons, and expanded far beyond its stakes in Reckitt Benckiser and Coty. The holding company became an investment vehicle to raise external capital as well as looking after the Reimann wealth. Today, JAB manages some €80 billion, including state investment funds and wealthy families.

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