Tetra Pak, a fortune founded on a clever idea

Tetra Pak, a fortune founded on a clever idea

source: NewYorkTimes

.The source of the enormous wealth that is driving the fascination with the death of US-born philanthropist Eva Rausing could hardly be more ordinary: drink boxes.

While Rausing's father, a Pepsi executive, was rich, her husband's fortune is far greater. He is the grandson of the founder of Tetra Pak, creator of sterile paper-based liquid cartons that in now one of the world's largest packaging firms, with sales last year of 10.3 billion euros, or $12.5 billion.

The company started in the mid-20th century with the creation of a geometric milk carton that is the forerunner of the ubiquitous drink box. The Swedish inventor, Ruben Rausing, studied at Columbia University and became fascinated there with what US engineers were doing with food packaging. Company legend has it that in the 1940s he was watching his wife, Elizabeth, make sausages by tying off the ends, and he wondered whether a similar system could be applied to milk, according to a 2000 article in The New York Times. He came up with an innovative box with four triangular faces, a tetrahedron, and named his company Tetra Pak.

He tinkered until he introduced, in the 1950s, an inexpensive paperboard-based package that could store liquids without refrigeration. Moving to a box shape meant it could be easily stacked and shipped. The combination transformed Europe's dairy industry. Tetra Pak grew into a conglomerate that sold other types of containers as well as water purifiers, bank-note dispensers and other products.

But in 1965, the Rausing family sold all those interests, keeping only Tetra Pak. To escape Sweden's high taxes, the company moved its headquarters to Switzerland in 1981.

When he retired, Ruben Rausing handed control of the business to his two sons, Gad and Hans, the father of Eva Rausing's husband, Hans Kristian. In 1995, the elder Hans sold his half of the business to Gad for a reported $7 billion. Gad died five years later, and his children are the sole owners of the private holding company that owns Tetra Pak.

Forbes estimates Hans Rausing's fortune at $10 billion. He and his three children, including Hans Kristian, have not been involved in Tetra Pak since the 1995 sale. Today, one of Hans Kristian's sisters, Lisbet, is a historian who founded the environmental grant-making fund Arcadia. The other, Sigrid, is active in human-rights causes and bought Granta magazine seven years ago.

Tetra Pak has almost 23,000 employees, and its packaging is used in 170 countries. It still specializes in containers for liquids that are not refrigerated, like broth, juice and soup. Giovanna Lemos, a spokeswoman for the company's US division, said its clients include Minute Maid, Juicy Juice and Swanson, the broth maker. It also now makes some refrigerated packages, such as the Tetra Top, meant to hold smoothies and other yogurt drinks.

Rather than selling the containers to clients, Tetra Pak instead sells the machinery required to package the liquids, Lemos said. As of March, there were 8,688 such machines in operation.