Interhandel

Interhandel was a Swiss holding company and conglomerate headquartered in Basel. Established in 1928 as I.G. Chemie, it was created by the German chemical group I.G. Farben to hold and manage foreign investments through a Swiss corporate structure. Its portfolio combined industrial and financial interests, including American IG and its principal American subsidiary, General Aniline & Film Corporation, later known as GAF Materials Corporation. The company also held stakes in smaller chemical businesses, banks, and property investments. The structure of I.G. Chemie became controversial during the Second World War. The United States government maintained that the Swiss company was not genuinely independent but functioned as a vehicle for concealing or protecting I.G. Farben's overseas ownership and control. In 1940, I.G. Chemie formally separated its direct ownership from I.G. Farben, a step that was presented as evidence of independence but was viewed by American authorities in the context of the broader wartime relationship between the two companies. After the United States entered the war, American authorities seized I.G. Chemie's American assets under the Trading with the Enemy Act of 1917. The seized property included bank deposits and more than 90 percent of General Aniline & Film's capital stock. I.G. Chemie challenged the seizures in American courts. The dispute involved allegations that the company and associated Swiss banking interests had helped camouflage German ownership of assets in the United States and elsewhere. The litigation also became entangled with Swiss restrictions on the transfer of banking records. In 1948, I.G. Chemie filed suit seeking the return of its property and argued that it was neither an enemy nor an ally of an enemy of the United States. A discovery dispute followed when Swiss law prevented the delivery of certain records held by the Swiss banking partnership Ed. Greutert & Cie, later associated with Sturzenegger & Cie. The American court ultimately dismissed the recovery action with prejudice after the company could not satisfy the court's document-production requirements, despite recognition that it had made good-faith efforts. The company later adopted the name Interhandel and continued to operate while the American ownership dispute remained unresolved. A large majority of its capital was concentrated in the claim relating to General Aniline & Film, making the company's value heavily dependent on the outcome of the litigation. In 1958, shareholders with earlier connections to I.G. Farben were bought out, and Alfred Schafer, chairman of Union Bank of Switzerland, became chairman of Interhandel. UBS had already accumulated approximately half of Interhandel's shares through market purchases, giving it substantial influence over the company. The dispute was resolved in 1963. General Aniline & Film's shares were subsequently sold through a competitive auction in 1965, and the proceeds were divided between Interhandel and the United States government. The settlement and sale produced a substantial cash position for Interhandel. Union Bank of Switzerland progressively consolidated its ownership and absorbed Interhandel in a 1967 merger. The transaction strengthened UBS's capital base and contributed to its emergence as Switzerland's leading bank by 1968. Interhandel therefore ended not as an independent chemical producer, but as a historically significant Swiss investment vehicle whose corporate identity was shaped by international ownership, wartime asset controls, and a two-decade transatlantic legal dispute.

Interhandel originated in 1928 under the name I.G. Chemie. It was established in Basel by I.G. Farben as a Swiss holding structure for foreign industrial and financial investments. The company owned or controlled interests in a number of businesses in Europe and the United States, including American IG and General Aniline & Film Corporation. Its corporate design used ordinary and preference shares, with voting influence concentrated among Swiss financial institutions and related investors. The relationship between I.G. Chemie and I.G. Farben became a matter of international dispute during the Second World War. In 1940, I.G. Chemie severed its direct ownership connection with the German parent. American authorities nevertheless alleged that the Swiss company remained part of a broader arrangement intended to conceal or protect German ownership of overseas assets. After the United States entered the war, assets associated with I.G. Chemie were seized under the Trading with the Enemy Act. The measures, carried out between 1942 and 1946, included bank accounts held in New York and more than 90 percent of General Aniline & Film's stock. I.G. Chemie contested the seizures. In a 1948 action, the company asserted that it was not an enemy corporation or an ally of an enemy and sought the return of its property. The litigation included extensive discovery proceedings. The United States sought records concerning the plaintiff, its subsidiaries, Osmon AG, and the Swiss banking firm Ed. Greutert & Cie, later associated with Sturzenegger & Cie. Swiss authorities prevented the transmission of some banking records on the ground that disclosure would violate Swiss penal law. Although the American court acknowledged that the company had made good-faith efforts to comply, it dismissed the recovery action with prejudice because the required documents had not been produced. The company subsequently operated as Interhandel. Its portfolio remained diversified on paper, but approximately 80 percent of its capital was tied to the claim and investment associated with General Aniline & Film. Other holdings included smaller chemical companies, Swiss and Panamanian banking interests, and property investments acquired largely after the war. This concentration made the company unusually dependent on the eventual outcome of its dispute with the American government. By the late 1950s, Union Bank of Switzerland had acquired roughly half of Interhandel's shares on the open market. In 1958, several shareholders with prior links to I.G. Farben were bought out. Alfred Schafer, then chairman of UBS, became chairman of Interhandel, further tightening the relationship between the two institutions. The American dispute was finally resolved in 1963. General Aniline & Film shares were sold in a competitive auction in 1965, and the proceeds were divided between Interhandel and the United States government. The resulting cash resources materially increased Interhandel's value. UBS gradually consolidated control and merged Interhandel into itself in 1967. The transaction provided UBS with additional capital and helped it become Switzerland's largest bank by 1968. Interhandel's corporate existence therefore ended through acquisition, while its historical importance remained tied to the legal, financial, and political consequences of wartime ownership of IG Farben-related assets.

1. 1967Interhandel is merged into UBS

   Union Bank of Switzerland absorbs Interhandel, ending the company's independent existence.

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2. 1965General Aniline & Film shares are auctioned

   The GAF shares are sold through a competitive auction, with the proceeds divided between Interhandel and the United States government.

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3. 1963The GAF dispute is resolved

   Interhandel and the United States reach a resolution to the long-running dispute over the seized American holdings.

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4. 1958UBS influence expands

   Shareholders linked to I.G. Farben are bought out, Alfred Schafer becomes chairman, and UBS's existing share accumulation gives it substantial control.

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5. 1948I.G. Chemie begins recovery litigation

   The company files a claim seeking restoration of its seized American property and disputes its classification as an enemy-related entity.

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6. 1942American assets are seized

   The United States takes control of General Aniline & Film and other assets associated with I.G. Chemie under enemy-property legislation.

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7. 1940Direct ownership connection with I.G. Farben is severed

   I.G. Chemie separates its direct ownership from I.G. Farben, although American authorities later challenge the practical independence of the structure.

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8. 1928I.G. Chemie is established in Basel

   I.G. Farben creates I.G. Chemie as a Swiss holding company for foreign industrial and financial investments.

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A Swiss-based international holding company focused on industrial, financial, and property participations rather than consumer products.

• International holding-company investmentsInvestment holding1928

  Interhandel did not principally sell branded consumer goods. Its core activity was holding equity stakes and other participations in industrial, financial, and property assets across several countries. The company served as a vehicle for managing overseas investments, with much of its value concentrated in its interest in General Aniline & Film and related American assets.

• General Aniline & Film Corporation interestChemical-industry investment

  The company's most important holding was its interest in General Aniline & Film, an American chemical and industrial business associated with American IG. More than 90 percent of the company's capital stock was seized by the United States during the war. The later settlement and auction of these shares formed the financial basis for Interhandel's final years.

• Other financial and industrial participationsDiversified holdings

  Outside the GAF-related investment, Interhandel held smaller chemical companies, banking interests in Switzerland and Panama, and property investments. These holdings represented the company's broader postwar portfolio but were less important to its valuation than the American claim.

• 1967Merge Interhandel into Union Bank of SwitzerlandM&A

  UBS had accumulated approximately half of Interhandel's shares and gained further influence after Alfred Schafer became chairman.

  What changed. Union Bank of Switzerland completed a merger that absorbed Interhandel.

  Aftermath. Interhandel ceased to exist independently, while UBS gained the company's capital resources and strengthened its position among European banks.

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• 1963Resolve the American asset disputeOther

  The company had pursued recovery of General Aniline & Film and related assets for more than two decades.

  What changed. Interhandel and the United States government reached a settlement resolving the dispute.

  Aftermath. The GAF shares were sold in 1965 and the proceeds were divided between the parties, leaving Interhandel with substantial cash resources.

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• 1940Separate the Swiss holding structure from I.G. FarbenStrategy

  I.G. Chemie was reorganized so that its direct ownership relationship with I.G. Farben was severed before the United States entered the war.

  What changed. The company presented itself as a separate Swiss entity while continuing to hold international industrial and financial interests.

  Aftermath. American authorities later disputed the effectiveness and substance of the separation and seized the company's American assets.

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• 1948Dispute over alleged IG Farben ownership and controlControversy

  American authorities alleged that I.G. Chemie was a front or camouflage structure for I.G. Farben. Interhandel's recovery action became one of the longest-running postwar disputes involving German ownership and foreign assets.

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• 1948Swiss banking-records conflict in American litigationControversy

  The litigation was complicated by Swiss restrictions on transmitting banking records. The inability to provide documents requested by the American court contributed to dismissal of the company's recovery action.

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• 1942Wartime seizure of IG Chemie-related American assetsControversy

  The United States treated assets associated with I.G. Chemie as connected to an enemy corporation and seized General Aniline & Film and other property during the Second World War. The action reflected allegations that I.G. Chemie helped conceal or preserve I.G. Farben's overseas ownership.

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• 1967Union Bank of Switzerland absorbs Interhandel

  UBS completed a merger that absorbed Interhandel and its substantial cash resources following the GAF settlement and sale.

  M&A
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• 1965GAF shares sold at competitive auction

  The shares of General Aniline & Film were sold in an auction, with the proceeds divided between Interhandel and the United States government.

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• 1958Alfred Schafer becomes chairman as UBS increases influence

  Shareholders with previous links to IG Farben were bought out, while Union Bank of Switzerland chairman Alfred Schafer became Interhandel chairman.

  Leadership changeM&A
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1. Interhandel