Thomas Middelhoff

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Middelhoff at the World Economic Forum.

Thomas Middelhoff (born May 11, 1953) is a German corporate manager. He was on the board of directors of Bertelsmann from 1990–2002, being CEO from 1998. From 2004 to 1 March 2009, Middelhoff was chairman of the supervisory board of Arcandor (previously KarstadtQuelle AG), and CEO of the company.[1] On November 14, 2014, Middelhoff was sentenced to three years in prison on account of having accepted advantages as former CEO of Arcandor.[2]

Background[edit]

Thomas Middelhoff was born in Düsseldorf, Germany, the son of a textile businessman. He studied business at the University of Münster and received his doctorate at the Institute for Marketing under the supervision of Heribert Meffert. While at university, he was already working in his father's textile business. After graduating he was given a high post in the company.

Bertelsmann (1986 - 2002)[edit]

In 1986 he moved to Bertelsmann, a multinational media corporation based in Germany, as assistant manager of the graphic firm in Gütersloh. In 1990, he became a member of the board of directors of Bertelsmann.

Middelhoff recognized the potential of the new digital media early. He made small investments into Firma Pixelpark in Berlin among others, on Bertelsmann's behalf. As an early believer in the rapid development of the Internet, he suggested a large financial participation of Bertelsmann in America Online (AOL) when it was still a young company, and created the joint venture AOL Europe, with a financial holding of $50 million for a 5% stake.[3] This investment was extremely successful and would later influence Middelhoff's ascent in the company to chairman of the board. In May 1995, he became a member of the governing board of AOL, and during his time in this position Middelhoff became a "close friend" of AOL's founder, Steve Case.

In 1995, Bertelsmann and AOL started the joint venture AOL Germany. From November 1998 to July 2002, Middelhoff was the CEO of Bertelsmann. During this time it increased its internet activities by starting the online media portal BOL (Bertelsmann Online), which was sold to buch.de in 2002. But Bertelsmann soon stepped back from these online engagements, selling its shares of AOL-Europe back to Time Warner, which had merged with AOL in 2001. In January 2000 Middelhoff declined a directorship at AOL and resigned from the supervisory board of the corporation.

Subsequent career[edit]

Beginning in 2003, Middelhoff coordinated the European affairs of the holding company Investcorp. The German businesses of the corporation included Gerresheimer Glas and Callahan. After APCOA Parking was taken over by Investcorp in 2004, he was appointed to its supervisory board.

Since 2003 Middelhoff has also been a member of the board of The New York Times Company responsible for the compensation committee. As a confidant of Madeleine Schickedanz, he became the chairman of KarstadtQuelle AG's supervisory board in June 2004 and its CEO in May 2005. KarstadtQuelle was renamed Arcandor in 2007.

On March 1, 2009 he was replaced in his position as CEO of Arcandor AG and Thomas Cook Group by Dr. Karl-Gerhard Eick, the former deputy chairman of Deutsche Telekom AG. The share value of Arcandor AG decreased rapidly under Middelhoff's aegis, from about 10 EUR per share (May 2005) to 1.30 EUR (February 2009).

On June 5, 2009 several media sources reported that the German justice minister Brigitte Zypries had recommended that the state prosecution service look into allegations of fraud against Middelhoff, based on the fact that he and his wife held shares of an investment fund that bought real estate from Arcandor and then allegedly leased it back it to Arcandor for unusually high rental fees.[4]

On June 9, 2009 Arcandor went bankrupt.[5] Later, parts of the company were sold to Nicolas Berggruen to save them from insolvency.

Middelhoff has five children and lives with his family in Bielefeld.

References[edit]

  1. ^ Announcement of replacement with Eick
  2. ^ Untreueprozess: Thomas Middelhoff zu drei Jahren Gefängnis verurteilt (German)
  3. ^ http://www.businessweek.com/2000/00_46/b3707001.htm
  4. ^ Der Spiegel, 6 June 2009, (in German) Immobiliendeals bringen Ex-Arcandor-Chef in Bedrängnis
  5. ^ Germany's Arcandor in bankruptcy

External links[edit]

This article incorporates information from the revision as of July 5, 2006 of the equivalent article on the German Wikipedia.