| HBS Case Collection
(Revised November 2005)
On July 28, 2002, Bertelsmann announced the firing of its CEO, Thomas Middelhoff, in a move that surprised industry observers, analysts, and many employees. Bertelsmann, a privately held company headquartered in Germany, was one of the largest global media conglomerates, with businesses spanning book publishing, printing, music, and television. Between 1998 and 2002, Middelhoff had initiated a series of strategic initiatives aimed at fostering greater integration among its diverse business units and strengthening their competitive positions, articulated a series of guidelines that would reevaluate Bertelsmann's portfolio mix, and looked to prepare Bertelsmann for a transition to a planned initial public offering in 2005. This case describes these initiatives in detail and the decision of the supervisory board to effect a change in leadership. The new CEO, Gunter Thielen, had to decide whether to effect a fundamental shift in the company's corporate strategy or a more modest reinterpretation of the course charted by Middelhoff. Includes color exhibits.
Keywords: Business Conglomerates;
Resignation and Termination;
Initial Public Offering;
Media and Broadcasting Industry;
Anand, Bharat N., Michael G. Rukstad, and Christoph Kostring. "Bertelsmann AG." Harvard Business School Case 703-405, March 2003. (Revised November 2005.)