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Family BusinessNews

19 February 2013

El Grupo Ferr Rangel was founded in 1944 by the grandfather of Antonio Luis Ferr. Antonio Luis

Ferr is the chairman of El Grupo Ferr Rangel and already employs five next-generation

members either in leadership positions in the editorial department or successfully running other

business units. The company consists of publishing and other media, printing, recycling, real

estate, a family venture capital fund and until 2002 a controlling stake in Puerto Rican Cement,

a NYSE-listed company. El Nuevo Da has got the highest circulation of any newspapers in Puerto

Rico and the newspaper Primera Hora is the fastest growing daily. Combined they have the

control over the market for news and advertising on the island.

Big Family, Big Obstacles A Success Story of

El Grupo Ferr Rangel

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Vivamus portaest sed est.

During the final stage of the

multiyear succession-and-

continuity process, the family

appeared less united.

Family members involved in the business starts very early in the Ferr family. All members began

their work while they were still in college. They all worked in lower-level jobs, and generally

reported to non-family members. They were also mentored and received feedback on their

performance and development. In 1993, the Ferr family began to meet regularly as a family to

discuss family and business issues. Over the next years they developed a family constitution, a

document that guided their succession-planning discussion. Between 1997 and 2002 every

member of the next generation grew into a position of significant responsibility. Along with

developmental opportunities, the new roles brought visibility and profit-loss implications, both of

which increased the amount of work they had to do. There was not much time left for the familyso the balance between work and family life was being threatened. Mara Luisa Ferr, the fourthgeneration president of the Grupo Ferr Rangel provided help to keep the family together.

During the final stage of the multiyear succession-and-continuity process, the family appeared

less united. For this reason a family council meeting produced an action plan to address the

gaps in communication and to improve the familys relationships with key nonfamily manager

during the entire succession-transition period. The meetings of non-family members and family

members were increased and key non-family members were invited to attend the family council

meetings. To reduce stress and focus on the most important issues, bridges were built to clarifythe succession process and its direction.

In 2005 after bringing non-family members and family members closer together Mara Luisa Ferr

was facing more problems. The 14-person board of the holding company was composed of 7

Ferr Rangel family members, 5 key executives from the various companies and 2 independent

outsiders. Several next-generation members were now concerned that this board of directors

was not holding management accountable to any significant extent. The next-generation

members stated that the current management lacked on the ability to make big decisions for

growing the company sustainable. Furthermore Mara Luisa was pondering the question of who

would decide which of the 12 grandchildren meets the criteria to employment at the Grupo andwho might one day want to be involved with it?

Some of her questions were solved by the creation of several classes of stocks and voting stocks,

which were only held by family members who were active in the management of the company.Any next-generation member choosing to leave the company would immediately have their

stocks revert to nonvoting stocks and be redeemed over a period of time. Other questions are stillan issue to the family, which needs constant attention in family meetings.

For more information, please see: Poza, E.J. (2010). Family Business (3rd ed.), Cengage Learning,Canada.

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General economic situation

Price competition

Continuous innovation

66%

61%

58%

52%

Family business United (2012) Availab

at:http://www.familybusinessunited.co.uk/news/story/43/

PwC (2012/2013) Family Business Survey Available at: http://www.pwc.com/us/en/private-company-services/publications/2012-family-business-survey.jhtml

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Mr XX Joke!

Mr. Greenberg was an illiterate immigrant, but he worked hard, saved his

pennies, and started a small business. It did well, and soon he had

enough money to send for the wife and children.

The work kept him very busy, so he never had time to learn to write, but

the bank was happy to do business with him, even though his signatureconsisted of two Xs.

He prospered, he opened more stores, the kids were transferred to

private schools, the family moved into a fancy house (with one staircasegoing nowhere just for show)you get the idea.

One day his banker, Mr. Smith, asked him to drop by. So vats the problem? Greenberg asked, a bit

anxiously. Smith waved a bunch of checks at him. Perhaps nothing, he said, but I wanted to be on

the safe side. These recent checks of yours are all signed with 3 Xs, but your signature of record hasjust 2.

Greenberg looked embarrassed. Im sorry about making trouble, he said, but my wife said thatsince Im now such a high class rich guy, I should have a middle name!

Interview with Mr Ammar CEO of Temaroc.

Me: Hello Mr. Ammar, could you please tell me, when was the companyfounded?

Mr Ammar: My father founded the company in 1955.

Me: Which type of cork you produce and why?

Mr Ammar: We are manufacturing a wide variety of cork with different size and diameters. Our consumersare giving us their specifications and we are working with it.

Me: Is the company a Family Business?

Mr Ammar: Yes, as I said my father founded this company. I was working as a doctor before. I was the

Director of Rabat Hospital called Avicenne. I took over the company when my father became too old tomanage it by himself. Soon I am planning to pass it over to my son to manage it.

Me: How will you deal with the succession process? Do you have only one son ?

Mr Ammar: No, I have 2 sons and 2 daughters. One of my sons is too young to take over the company now.

My daughters are not interested in the business and are already working. So we had as you call it a family

reunion to decide what to do. I was surprised how my children were talking and came to a conclusion that

my older son needs to take over. He just finished university and now is working by my side in the companyso I can explain him how the company works.

Me: So the succession process in your case was easy?

Mr Ammar: Yes it was!