The German Mittelstand isn’t the first place you would expect to find the type of intrigue suited to an airport novella. But a struggle for control of a kitchen-fittings company has broken out between a shadowy Eastern European family and a revenge-driven ex-manager who fought her way up from humble beginnings.
The Mittelstand is often referred to as the backbone of the German economy. Made up of family-run businesses, it is synonymous with the conservative, small town values of wealthy southern states like Bavaria. But in the town of Pfullendorf in neighboring Baden-Württemberg an immigrant by the name of Ipek Demirtas pushed her way to the top of one such company, the kitchen-fittings maker Alno.
Like so many of these Mittelstand companies, Alno likes to show off its humble beginnings. On its website it proudly describes how it was founded in 1927 by Albert Nothdurft in his parents’ home in Wangen, a village 70 kilometers, or 43 miles, east of Pfullendorf. (Notdurft, the modern spelling, means something like “nature’s call”.)
Ms. Demirtas hails from somewhat further afield. Born in a small village in eastern Turkey, she rose through the German school system to pass her university entrance exams. From there her advancement was rapid. She got her degree, took on initial jobs, and then blitzed through the career stages at Alno, finally becoming finance manager. Her hair is parted severely right down the middle; her gaze is piercing; her lips are prominent and pugnacious. This isn’t a woman who fits into the easy Mittelstand narrative of companies handed down from father to son.
Step by step, the Hastors brought Alno fully into their control.
But it is unclear where this against-the-odds career is going next. That’s because the now ex-finance manager of Alno has picked a fight with an adversary who isn’t used to rolling over. The Hastor family, originally from Bosnia, has already stirred up the German car industry with their supplier firm, called Prevent. And in autumn 2016 they bought into Alno, a decision which eventually led to Demirtas’ dismissal and her attempt to strike back via a secretive “off-shore” firm.
The Hastors became involved in Alno because the company had been struggling for decades. At first there was hope that the Hastors could offer a second chance. Despite only buying a minority stake, they soon dominated the firm’s management. Out of six seats on the financial board they took five.
Employees began to complain that they couldn’t move without first seeking permission from someone at Prevent. “It seemed pretty dubious to us that Prevent was allowed to meddle so much in daily business,” one ex-manager said. The Hastor family denies that Prevent was involved in the management of Alno, claiming that former Alno managers are trying to cover up their own failures.
But step by step, the Hastors brought Alno fully into their control. Several Alno subsidiaries appear to have been mortgaged to a company belonging to the family. A spokesman for the family said that Alno AG had “issued regular market securities for loans given by a company belonging to the family.”
The Hastors have also put the long-term management of the company on the chopping board. Three of the four members of the board of directors have cleared their desks, including the long-time chief executive Max Müller.
Ms. Demirtas meanwhile was sacked without notice in March. But that was far from the end of the story. Within days of her exit a company called First Epa had been set up in Lichtenstein. Soon after, the First Epa bought up claims that another household-goods firm, called Bauknecht, had on Alno. Those claims had a value of €54 million, or $64 million.
It turns out that Ms. Demirtas owns a third of the shares in First Epa. The rest belongs to an unknown group of investors. According to insiders, Alno’s former boss is also involved. The firm would have had to approve of the transaction with First Epa while Mr. Müller was still CEO. In other words he potentially rubber-stamped the sale of claims on Alno to himself.
Ms. Demirtas no doubt saw good business in the purchase. “But there was certainly a desire for revenge there too,” someone who knows her well said. “Müller and Demirtas couldn’t accept the fact that they had been driven out.”
But even this dubious business deal has turned sour. The Hastors were unable to turn Alno’s fortunes around. On July 12 the kitchen company filed for insolvency. That also reduces the value of the First Epa’s investment.
But then an advisor working on the restructuring of Alno stumbled across the secret sale transaction between Bauknecht and First Epa. The Hastors quickly counterattacked, making an ultimatum to the Lichtenstein-based firm. Ms. Demirtas has now made a counter-counter offer. She also hopes to place her own confidantes on important committees at Alno, replacing the administrators forced upon the company by the insolvency. Legal experts doubt that the plan will ever materialize. Ms. Demirtas responds by citing a man well versed in the words of war, Winston Churchill: “I have never, never, never given up.”