International -- The Stars of Europe -- Turnaround Artists
Michael Frenzel (int'l edition)
CEO -- Preussag -- Germany
Plenty of executives could learn from Michael Frenzel: In just two years, the soft-spoken CEO of Germany's Preussag has transformed his steel and engineering company into Europe's biggest travel group. Preussag's fiscal 1999 profit rose 14.6%, to a record $314 million on sales of $15 billion, with tourism accounting for more than half the total and most of the growth.
Frenzel, 53, saw an opportunity in 1997. State-owned Westdeutsche Landesbank, which holds 33% of Preussag, had decided it wanted to unload its stakes in the travel business. Frenzel suggested creating a company that would book everything from transportation to hotels--something that didn't exist in Germany's fragmented market.
So in 1998, he sold Preussag's steel unit to Norddeutsche Landesbank and the state of Lower Saxony, which floated it on the stock market. Then he bought WestLB's package-tour operator TUI and Hapag-Lloyd, owner of cruise ships. From there, he kept on buying rivals: In his latest coup, Frenzel offered $2.6 billion to win a bidding war for Thomson Travel.
Next year, Frenzel aims to spin off Preussag's logistics and industrial divisions so he can focus on travel, thus completing one of Germany's most radical corporate makeovers ever.