C&A brought the family billions. A green investment push is next (2024)

Close to Highway 401, which runs from Toronto to Detroit and connects Canada with the United States, a building of impressive dimensions is being built – a greenhouse the size of 33 football fields.

The company Ontario Plants Propagation will one day grow 34 million seedlings per year here for vegetable and berry growers in North America. The facility is being built by Dalsem, a greenhouse constructor from the Netherlands.

The surprising thing about the two companies is the owner. Both Ontario Plants Propagation and Dalsem are owned by Cofra Holding. This is the corporate entity through which the Brenninkmeijer family, which owns the C&A department store, bundles its investments. This empire has long included much more than clothing stores.

Boudewijn Beerkens has been CEO of Cofra since 2019. His job is to preserve and expand the assets that the Brenninkmeijer family has built up over more than 180 years. The greenhouse in Canada is part of a new business segment that Cofra is developing.

«Global warming is a threat to food production,» says Beerkens, a Netherlands native, during an interview in Zurich. «Technologies that enable agriculture in a controlled environment are an attractive investment.» Such processes would allow sufficient food to be produced with less water and pesticides under changed conditions, he says.

From Mettingen to Zug

In the early days of their business, the forebearers of today's Brenninkmeijers carried out their business in rural areas. As cloth merchants, they set out from Mettingen in what is now the German state of North Rhine-Westphalia, and sold their goods in villages and on farms. Mettingen is still an important place in the Brenninkmeijer cosmos, as the family still meets and maintains a museum here.

Another important place for the company's history is the Dutch city of Sneek. It was there in 1841 that Clemens and August Brenninkmeijer opened their first clothing store, which became an international chain. The C&A stores still bear the initials of their first names today.

However, the nerve center for the Brenninkmeijer empire is located neither in Germany nor in the Netherlands, but in Switzerland. At the beginning of the 1920s, family members founded a company in the canton of Glarus – a popular address for shell companies at the time – whose main purpose was the tax-efficient management of investments in German and British C&A affiliates. Behind the company’s odd official corporate name of Öl- und Fett-Industrie AG (Oils and Fats Industry Corporation), historian Mark Spoerer suspects «a mixture of wit and an intention to disguise.»¹

Today, Cofra manages its holdings from the Swiss canton of Zug. One of the few figures that Beerkens is willing to disclose offers an idea of the size of the business: He estimates the firm's total assets under management at over 30 billion euros ($32.6 billion.)

Most of this value (17 billion euros) is accounted for by investments of the private equity company Bregal alone, and around a third (9.7 billion euros) by the Redevco real estate subsidiary. The latter was created when the C&A properties were spun off into a separate company. Today, however, Redevco handles a portfolio that goes well beyond this inventory. Cofra also owns the subsidiary Anthos Fund & Asset Management – which should not be confused with the Brenninkmeijers' Anthos family office.

The traditional clothing business is therefore only one of several pillars of income. Nevertheless, Beerkens emphasizes: «C&A is a crucial part of the group, and will remain so.» He has high expectations that the management team will get the retail business back on track after a weak period. After streamlining its store network, the company recently announced plans to open 100 new stores in Europe.

The once very international clothing company, which maintained stores in the United States and China, now operates almost exclusively in Europe. Elsewhere, a remnant of C&A can be found only in Latin America. The sale of the Mexico business has just been completed. Cofra holds around 65% of C&A Brazil, an independently listed company.

For the further development of the company and the establishment of new business areas, capital must be shifted within Cofra. This is one of Beerken's tasks. As if all this wasn't complex enough, the Brenninkmeijers also want to be «a force for good,» as stated in the company's basic principles. And all «in a world that changes every 30 seconds,» Beerkens says.

The company’s activities must conform with guidelines provided by the owners, he adds. Cofra's shareholders are a group of between 50 and 60 family members. The exact number is not disclosed, and fluctuates over time. In reference to its beginnings in the town of Sneek, the group is also known as the «Sneeker kring» – with «kring» being Dutch for circle.

Inheritance of shares not possible

Only those who have a parent who was also part of this committee can be accepted into the select Sneeker kring circle. But that alone is not enough, because the shares are not inherited. Anyone who wants to join must apply, prove themselves and buy in. «These are not ‹just› owners,» says Beerkens. «All our shareholders have to take on a leadership role in one of our companies.»

Until the 1990s, the rules of the largely Catholic family only allowed male Brenninkmeijers to become members of the circle, and thus co-owners of Cofra. Today, women have also become part of the group of owners, which includes members from the sixth generation of the family. How many women are now involved remains a secret.

In order for the circle to renew itself, members of a certain age are expected to leave and make way for younger Brenninkmeijers. The benchmark for this age is 55, but today many shareholders are still active well beyond this age, says Beerkens.

On a day-to-day basis, the Brenninkmeijer family shareholders have to subordinate themselves to an external manager who, like Beerkens, does not have a personal ownership stake in the company. Does this create tensions in the day-to-day operations? «We make a strict distinction between the two roles,» says Beerkens. It depends on the hat being worn, he adds: «In a meeting you are my colleague – at a shareholders' meeting, you are the owner, and therefore de facto my boss.»

Beerkens may not be a Cofra shareholder himself, but he is part of the wider Brenninkmeijer family circle. «That has helped me to understand certain things,» he says. However, he has largely made his career outside of Cofra, including as a partner at the auditing firm PwC and as chief financial officer at SHV Holdings, a conglomerate owned by the Dutch Fentener van Vlissingen family.

When asked what the owners expect in terms of dividends, Beerkens answers tersely: «The distribution is not the main focus.» Building up a business of this size requires very significant levels of reinvestment, he adds.

An unspecified portion of the group's income has always gone to charity. In fact, over the decades, an impressive network of foundations has emerged, with which the family donates money to social and ecological causes as well as Catholic organizations.

The family shareholders also got involved when it came to realigning Cofra. The CEO recalls intensive, «lengthy» discussions and workshops, including with family members, in the search for new business areas. How profitable is this area? How viable over the long term? What benefits does it have for society? The process took about a year, he says. Over the course of 2019, the areas of clean energy and sustainable food were jointly identified.

Second attempt with solar energy

The family already had experience with renewable energies, albeit these had been mixed. Members recognized the potential of solar energy early on, invested, earned money – and lost it again. When prices for solar cells collapsed in 2011 due to global overcapacity, the value of the Brenninkmeijers' stake in Qcells, a manufacturer of photovoltaic cells, dropped to millions from billions within a very short space of time.

Now Cofra is trying again in the solar industry. Sunrock, which was acquired in 2021, describes itself as one of the largest investors, developers and owners of large photovoltaic solar roof systems in Europe.

«We like real assets, and things that can be scaled up,» says Beerkens, explaining the choice. This also applies to investments in the food sector such as greenhouses and plant cultivation, he adds.

Meat from a laboratory might also qualify as climate-friendly nutrition. But Beerkens waves this suggestion off: «Countless attempts for one product, of which maybe one or two will work? It's not us! If something is too volatile, it doesn't fit in with the group's culture.» Cofra prefers to avoid investing in early development stages, where the risks involved are too high.

Wanted: Co-investors with capital

In general, the holding company wants to cushion strong fluctuations in its business. The diversification of its activities, which began with the founding of the real estate company and continued with new business areas, is now set to reach a new level with the entry of external investors.

A few Cofra investments already have nonfamily investors on board. What they are now looking for is a larger number of «like-minded investors,» as Beerkens puts it, who want to invest alongside the Brenninkmeijers. In addition to the right mindset, interested parties must above all have enough money. Institutional investors such as pension funds or insurance companies, but also family businesses or university investment funds, are therefore eligible.

The Brenninkmeijer family will continue to hold ownership of Cofra itself close. However, third parties will be able to invest in the development of the new energy and food sectors, in Redevco's real estate projects, or in a Bregal private equity fund. These latter are mainly invested in Europe and North America.

In Switzerland, Bregal owns the Embassy and Kirchhofer jewelry chains, as well as the Kunststoff Schwanden plastics company. The private equity company invests in all kinds of sectors, including automotive suppliers, software, logistics, tour operators, restaurants and children's bikes (Woom), but more exotic investments such as a salmon farm and equipment for bowhunting are in the portfolio. As is usual with private equity, the investments are usually sold after a few years. Bregal recently sold the German industrial company EA Elektro Automatik to an American buyer for 1.6 billion euros ($1.74 billion).

A better world and less risk

Beerkens justifies Cofra's openness to third-party funding by noting it will allow for greater impact: With more capital, he says, the holding company will more quickly be able to achieve substantial progress in terms of sustainability and the fight against climate change, as the Brenninkmeijers have set themselves the goal of doing. He says his job performance evaluations partially depend on the improvements achieved in this area.

However, the inflow of new funds is also reducing the risks for Cofra and helping to diversify the family's assets. Beerkens offers a hypothetical example: «Instead of owning six properties in one country outright, why shouldn't we have a half-interest in 12 properties?»

When asked how much external capital is required, Beerkens says: «We would have no difficulty doubling the size of the group in the next five to 10 years.» If this were to happen, the investments managed by Cofra would one day be worth around 60 billion euros instead of around 30 billion – with the difference that around half of the shares might then be in the hands of external investors.

Such a transformation would change the character of Cofra, as well as the self-image of the family, which for almost two centuries has worked in a close circle to preserve its prosperity. This change may be just as challenging as improving the world.

¹ M. Spoerer, C&A – ein Familienunternehmen in Deutschland, den Niederlanden und Grossbritannien 1911–196; C.H.Beck, 2016.

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