Interhandel

Interhandel
Company type	Conglomerate
Industry	Conglomerate, Financial services, Chemicals
Predecessor	I.G. Chemie
Founded	1928; 98 years ago
Founder	I.G. Farben
Defunct	1967
Fate	Acquired by Union Bank of Switzerland (UBS)
Headquarters	Basel, Switzerland
Key people	Walter Germann (Managing Director), Dr. Alfred Schafer (Chairman)
Products	Chemical enterprises, banking services, real estate holdings
Parent	Union Bank of Switzerland (after 1967)

Interhandel, an abbreviation for Internationale Industrie & Handelsbeteiligungen, was a Swiss conglomerate notably involved in prolonged legal conflicts with the U.S. government concerning German ownership during World War II. It was the successor to I.G. Chemie, which the United States alleged functioned as a front organization for Germany's I.G. Farben throughout the war.

Originally established as IG Chemie, Interhandel was publicly listed in Switzerland and featured a complex shareholding arrangement that concentrated voting power primarily within Swiss banking institutions. Approximately 80% of its assets were invested in the longstanding GAF holding company, while the remainder comprised smaller chemical enterprises, Bank Hoffman of Switzerland, a Panama-registered bank, and various real estate holdings—most of which were acquired after World War II under Managing Director Walter Germann, who had connections to M. Greutert, I.G. Farben’s representative on the Swiss board.

By 1958, prior to the conclusion of the GAF/Interhandel litigation in the United States, several shareholders affiliated with I.G. Farben—including Industrie Bank and M. Sturzenegger—were bought out. Subsequently, Dr. Alfred Schafer, chairman of UBS Bank, assumed the role of Interhandel’s chairman. UBS had purchased close to half of Interhandel’s shares on the open market. Following Interhandel’s announcement that it would receive $122 million USD in compensation for GAF shares confiscated by the U.S., its stock price rose sharply, enabling UBS to incrementally gain control and absorb the funds through a merger completed in 1967.

In 1967, Interhandel was fully acquired by the Union Bank of Switzerland.

History

The entity preceding Interhandel, I.G. Chemie, was established in 1928 by I.G. Farben as a Swiss holding company based in Basel. Its purpose was to manage foreign investments, including those related to American IG.

By 1940, I.G. Chemie had deliberately severed direct links with I.G. Farben to prevent U.S. authorities from seizing its assets. After the United States entered World War II, on April 24, 1942, it confiscated General Aniline & Film (later known as GAF Materials Corporation), a subsidiary of Interhandel. The ensuing dispute persisted until 1963. In 1965, GAF shares were auctioned off with proceeds divided between Interhandel and the U.S. government, leaving Interhandel with significant cash reserves at the time of its merger with UBS.

The capital gained from Interhandel significantly contributed to UBS’s rise as Switzerland’s top banking institution by 1968 and established it as one of Europe’s most robust financial entities, supporting its growth through the late 1960s and into the 1970s.

The IG Chemie case

Between 1942 and 1946, all American assets owned by IG Chemie were seized under the authority of the Trading with the Enemy Act of 1917. These assets included bank accounts held at six New York banks and more than 90% ownership of General Aniline & Film Corporation (now known as GAF Materials Corporation), which was part of American IG's portfolio.

The U.S. government accused I.G. Chemie of collaborating with I.G. Farben, classified as a German enemy corporation, to obscure I.G. Farben’s ownership and control over global properties, including those within the United States. The Swiss banking firm Ed. Greutert & Cie (which later became Sturzeneggar & Cie and is currently known as Baumann & Cie, Banquiers) was also implicated in this arrangement.

In an effort to reclaim its assets, IG Chemie initiated legal proceedings on October 21, 1948, asserting that it was neither an enemy nor allied with an enemy of the United States. The holding company sought discovery of documents from the government pursuant to Rule 34 of the Federal Rules of Civil Procedure. Meanwhile, the government filed a comparable request for documents from subsidiaries Osmon A.G. and Sturzenegger & Cie. Despite objections from IG Chemie, the court mandated full disclosure.

Although the government complied with these orders, IG Chemie encountered difficulties when Swiss authorities barred H. Sturzenegger & Cie from releasing records due to Swiss criminal law restrictions. Consequently, despite earnest attempts to comply, IG Chemie's lawsuit aiming to recover seized assets was dismissed with prejudice because it failed to satisfy U.S. court requirements for document production.

History

The IG Chemie case

See also