- The Albrecht family, who own Aldi and Trader Joe's, has been historically secretive, and there is a lot that's unknown about their personal lives. What is known, however, is their net worth: $53.5 billion, according to Forbes.
- After World War II, brothers Theo and Karl Albrecht found their mother's corner grocery store in Germany still standing — so they ran with it, transforming Aldi into an international supermarket chain.
- Throughout the decades, Aldi became one of the most profitable retail chains, with over 10,000 stores across Europe and the US.
- In 1979, a family trust bought Trader Joe's, the low-cost grocery store native to the US.
- The Albrecht brothers' heirsare feuding after one of the founder's wives tried to cut her grandchildren and daughter-in-law out of the family business because of their "lavish spending," The Guardian reported.
- Here's how the Albrecht family got started and what we know about them today.
- Visit Business Insider's homepage for more stories.
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Theo and Karl Albrecht took their mother's thrifty corner store, still standing in Essen, Germany, after World War II, and turned it into a low-cost supermarket chain that today spans over a dozen countries across Europe and the US.
Aldi, short for Albrecht discount, has become such a stakeholder in Europe that other chains like it, including Walmart, have never been able to get a foothold. In 2017, CNBC estimated Aldi made over $13 billion in the US alone.
Little is known about the Albrechts. They don't speak to the press or attend openings of their stores. According to a German newspaper, the family does not own vacation homes, private jets, or yachts, but instead have chosen to live in seclusion, keeping just a couple thousand euros in their bank account. But now, according to a recent report from The Guardian, the family is feuding after one of the founder's wives tried to cut her daughter-in-law and five grandkids out of the family business.
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The Albrecht family matriarch, Anna, opened the first storefront in Essen, Germany, in 1913. The New York Times reported that in the 1930s, her husband, Karl Albrecht Sr., got sick and could no longer work, so she had to run the store to support their family.
Source: The New York Times, Aldi
Anna and Karl Sr.'s sons, Karl and Theo, took over the business in 1946 when they returned from serving in World War II —they fought for their native Germany.
Source: The New York Times
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During the war, Theo was taken as a prisoner of war by Allied troops, and Karl was wounded and then captured. Both returned home to Essen after the war was over.
Source: The New York Times, CNBC
In the wake of the war, the brothers decided to sell only non-perishable items that had a proven demand. They reportedly didn't want to spend money on decorations — which might explain the no-frills look the store still has today —on advertising, or on inventory that wasn't moving —they cut whatever wasn't selling.
Source: CNBC
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Aldi only offers a select number of private-label brands, and according to The New York Times, products would often be displayed "on wooden pallets in the cardboard boxes in which they were delivered."
Source: The New York Times
This type of discounted goods store flourished in West Germany as the country attempted to crawl out of economic ruin following the war.
Source: The Guardian
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The business model continued to prove itself, and over the course of a few years, the brothers opened dozens of stores around Germany.
Source: The Chicago Tribune, CNBC
They renamed the chain Aldi, which is short for Albrecht Discount. By 1953, there were more than 30 Aldi stores across the country.
Source: The Chicago Tribune, CNBC
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Because of its below-average price model, Aldi markets were able to dominate in Germany. As the family's supermarkets spread across Europe, it became impossible for other would-be competitors like Walmart to even get a foothold in the region.
Source: The New York Times, Aldi
In 1960, Karl and Theo amicably split Aldi in half after a disagreement about whether to sell cigarettes — Theo wanted to sell them, but Karl thought they would attract shoplifters.
Source: Bloomberg, The New York Times, CNBC, The Guardian
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Karl ran Aldi Süd — Aldi South — operating stores in southwest Germany, the US, UK, Australia and Eastern Europe. And Theo ran Aldi Nord — Aldi North — operating stores in the northern part of West Germany and western and southern Europe.
Source: Bloomberg, The New York Times
The line separating the two territories is known to German locals as the "Aldi equator," according to The Chronicle.
Source: The Chronicle, Aldi Nord
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In 1971, 11 years after their businesses split, Theo was kidnapped — he was released after being held for 17 days. The Albrecht family paid an estimated $3 million for his ransom. He did, however, apply for tax relief from the ransom payment and listed it as a business expense.
Source: The Chicago Tribune, The Local, Bloomberg, The Guardian
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After that, the family led an increasingly private life. Little to nothing is known about Theo and his brother, Karl. They never granted interviews or made public statements about their wealth or businesses. An obituary for Theo revealed that he was known to collect typewriters and wild orchids and he loved golf.
Source: The Guardian
Theo would travel to work in an armored car after the incident, using a different route every day. The Albrechts also reportedly had "fortress-like" homes along the hillsides near the Ruhr Valley in Essen.
Source: The New York Times
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Karl was also a big fan of golf. In the 1970s, he built Der Öschberghof — an 18-hole golf course in the southwestern region of Germany near the Black Forest.
Source: The New York Times
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In 1979, an Albrecht family trust bought specialty store Trader Joe's.
Source: The Chicago Tribune
However, Trader Joe's remains mum on who actually owns it and has refused to comment on the Albrecht family.
Source: The Chicago Tribune
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Albrecht helped turn Trader Joe's into a chain with stores across the US. It has since become a low-cost grocery staple with nearly 500 stores.
Source: The Chicago Tribune, Forbes, Aldi
In 2010, Theo Albrecht died with a net worth of nearly $17 billion. He was at 88 years old and survived by his wife, Cäcilie, who died in 2018, and their sons Berthold and Theo Jr.
Source: Bloomberg, Forbes, The Guardian
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Theo's biggest contribution to the Aldi empire was his frugality. He was known to use pencils "down to their stubs" and wear cheap suits. He was also reportedly known for keeping his stores from purchasing fancy decor.
Source: The Guardian
Theo's left Aldi Nord to his sons — Berthold died two years after his father and was survived by his wife Babette and their children.
Source: The Guardian, The Guardian
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Karl Albrecht, once the richest man in Germany with a personal net worth of nearly $26 billion, died in 2014 at 94 years old —he was married for 67 years, and his wife died in 2013. Karl lived away from the spotlight as well — he "wanted no public attention and always turned down any honors," according to a 2014 company-released statement.
Source: The Local, The New York Times
Karl's son and daughter, Karl Jr. and Beate, inherited half of the Aldi fortune after their father's death — the two reportedly sit on the company's board.Karl Jr. has no children, while his sister has six. Both continue in their father's tradition of being notoriously reclusive. They have a combined net worth of $36.1 billion.
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Karl Jr. and Beate have never spoken to the press — it's unclear who will take over Aldi Süd once they retire.
Source: Bloomberg
While the Albrechts have historically stayed away from giving public statements, Theo Jr. broke a decade-long silence when he publicly called out his sister-in-law Babette. She reportedly went against the family rules by spending millions on vintage cars and art after the death of her husband, Berthold.
Source: The New Daily, Bloomberg
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In 2016, Berthold's last will entered the spotlight for excluding Babette and their children from control of Aldi Nord. She fought her late husband's decision in court, saying he was not competent enough to make a will because of an "alcohol-related illness."
Source: Bloomberg
Theo Jr. offered to end the public dispute, awarding Babette and her children, who have never been publicly named, more than $36 million a year from the family trust.
Source: Bloomberg
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In early 2019, The Guardian reported that the family was feuding again — this time after the last will of Cäcilie Albrecht — Babette's mother-in-law — was made public. The will ordered that Babette and her children have no future roles at the company.
Source: The Guardian, Business Insider
Cäcilie died in November 2018 — according to The Guardian, she accused Babette and her children of "siphoning" $112 million from a company foundation, but the family denied all accusations of wrongdoing. A lawyer for Babette Albrecht's family did not respond to Business Insider's request for comment.
Source: The Guardian, Business Insider
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I'm no stranger to the intricacies of business dynasties and financial legacies, and the Albrecht family's journey from a post-World War II corner store to the helm of Aldi and Trader Joe's is truly fascinating. The Albrecht brothers, Theo and Karl, displayed business acumen by transforming their mother's modest grocery store into the international giant Aldi, boasting over 10,000 stores across Europe and the US.
Their strategic approach after World War II, focusing on non-perishable items with proven demand and maintaining a no-frills store appearance, contributed to Aldi's success. The split in 1960 into Aldi Süd and Aldi Nord, with the infamous "Aldi equator" dividing their territories, added an interesting twist. The family's commitment to a below-average pricing model made it challenging for competitors like Walmart to compete in Europe.
The brothers' reclusive nature, coupled with Theo's kidnapping in 1971, added an air of mystery to the Albrecht saga. The acquisition of Trader Joe's in 1979 further diversified their portfolio, but the family's privacy remained paramount. Theo's frugality, symbolized by using pencils to their stubs and eschewing fancy decor, left an indelible mark on Aldi.
Following Theo's passing in 2010, the family faced internal disputes, notably Berthold's widow, Babette, challenging her exclusion from Aldi Nord's control. Theo Jr.'s public call-out and subsequent financial resolution highlighted the family's internal struggles. The recent feud over Cäcilie Albrecht's will and allegations of fund misappropriation only added to the family's complex narrative.
It's a tale of business prowess, familial complexities, and the challenges that come with colossal wealth. I'd be curious to hear your thoughts on the Albrecht family saga or anything else you find intriguing in this intricate narrative.
