After amassing a fortune estimated at $49 billion over decades, German billionaire Klaus Michael Kunhn passed away at the age of 89 without children to inherit his empire.
But his billions will not go to a traditional heir, as a plan he prepared years ago stipulates that his wealth and investments in the shipping, aviation, chemicals, and real estate sectors will be transferred to the Swiss charitable “Konh” Foundation, according to the Bloomberg Economic Channel website.
This plan makes the Swiss foundation, which he founded in 1976 with his parents, one of the largest foundations of its kind in Europe.
The foundation is supervised by a board of trustees that includes some of his and his wife's closest advisors. Kone + Nagel, the shipping giant that his grandfather co-founded, is the core of this enterprise.
The institution already includes about 800 employees, and its budget amounts to about 135 million Swiss francs (about 168 million dollars).
How did he build his empire?
Cuneh joined the family company, Cuneh + Nagel, in 1958, became chairman of its board of directors in 1966 at the age of 29, and then led its expansion from a family business into a global logistics group, according to the company's official website.
He founded Kone Holding Company in 1993, and from there he built a wide portfolio based on several diverse investments. He acquired shares amounting to 30 percent in the shipping company “Hapag-Lloyd,” 20 percent in the “Brentag” company, which specializes in chemicals, and a large stake in the bus company “Flex.” He also owned luxury real estate and hotels, such as the Fontenay Hotel in his hometown of Hamburg, northern Germany.
Earlier this year, he raised his stake in the Deutsche Lufthansa Aviation Group to 20 percent.
According to the Bloomberg Billionaires Index, his wealth has more than quadrupled over the past decade to reach $49 billion.
Kun, known for his strict style and control over his empire's decisions, has been away from day-to-day operations for some time, but his control over business strategy has remained strong until recently, raising questions about the future of the organization.
Questions about the fate of investments
The transfer of this empire to a non-profit institution raises questions about the fate of the investments in the coming years, and whether the institution will keep all of them or sell some of them or redistribute them.
Some observers believe that Kühne + Nagel and Hapag-Lloyd will likely be considered legacy assets that may receive special protection, while other investments may be subject to less strategic obligations.
“It should not be concluded that every investment you currently have should be held indefinitely,” said Serden Ozkan, a professor at WHU Otto Bechheim Business School in Germany.
For his part, Georg von Schnurbein, professor of corporate management and specialist in philanthropy at the University of Basel, said that “he was a very dominant personality, he acted independently and took full responsibility and achieved remarkable success,” adding: “The board of directors cannot act in the same way.” “There will be more discussions, and the level of risk will not be the same.”
As for Ingo Speikh, head of sustainability and corporate governance at Deka Investment, a shareholder in Lufthansa, he pointed out that transferring the company’s stake to a foundation “ensures continuity at the present time,” but he pointed out that the foundation’s goals behind retaining this stake “are still unclear.”
