Babiš's Hartenberg holding posts record revenue on acquisitions

Hartenberg Holding, the investment group through which Czech Prime Minister Andrej Babiš manages part of his fortune, closed last year with the highest revenue in its history — 940 million euros, or roughly 22.7 billion crowns, up 13% year on year. Operating profit before depreciation and taxes rose 15% to 3.1 billion crowns.

The main driver of that growth wasn't organic performance but an active string of acquisitions. "It was a record year. Behind it is a combination of organic growth and acquisition deals," said Josef Jánov, managing partner of Hartenberg Capital, who directly oversees the group's investments.

Over the year Hartenberg acquired six companies — three online stores and three medical clinics. Through its enterstore platform, the group bought the Swedish lingerie brand Miss Mary of Sweden, baby-products retailer 4Kraft, Czech company ČistéDřevo.cz and the Dutch clothing brand Joe Merino.

The holding's healthcare division also expanded briskly. Its portfolio gained the Turkish Bahçeci Group, with clinics in Turkey and the Balkans, Romania's Clinica Autentica, and Britain's Herts & Essex Fertility Centre. All three companies specialise in assisted reproduction, an area where Hartenberg is building the FutureLife network, which already counts more than sixty clinics in fifteen European countries.

Even so, the holding as a whole ended the year with a loss of 368 million crowns. "As long as we're not selling companies, we show a loss," Jánov explained, describing this quirk of the group's accounting model.

Hartenberg also has a reverse process under way — shedding non-core assets. That means aircraft maintenance businesses: Slovenian company Adria Tehnika is being bought out by British airline easyJet, with Serbia's JAT Tehnika next in line. According to Jánov, these deals will cut the holding's revenue by around 1.5 billion crowns, though profit should still edge up slightly.

Hartenberg remains practically the only major asset of Babiš's that hasn't gone into a trust fund — the prime minister placed his Agrofert holding there over a conflict of interest, but kept the investment group for himself. Through the company SynBiol, he controls 87.75% of Hartenberg, with a further 9.75% belonging to Jánov himself and the remainder to Libor Němeček, who handles acquisition deals at Agrofert.