2.1. Corn mills and electricity

1The use of water power to grind grain is one of the earliest applications of machinery in human history. Beginning in the regions along the Rhine, the Moselle, and the Danube, watermills had spread throughout Europe by the twelfth century. The first watermills in Styria appeared as early as the second half of the eleventh century, although their prevalence did not increase significantly until the thirteenth century. By the end of the sixteenth century, many grain mills had been converted into scythe hammers, trip hammers, and wire-drawing mills, which required less charcoal and water than ironworks and could therefore operate on rivers with lower water flow. Following Werner von Siemens’s invention of the first practical electric generator in 1867, mills began to harness electricity for both power generation and to drive machinery.⁶ After 1880, the number of commercial mills declined sharply, primarily because of cheap grain imports from Hungary and the resulting reduction in grain cultivation in Styria. At the same time, large mechanised roller mills were established in the lowlands – especially in southern and south-eastern Styria – displacing smaller mills in the mountainous regions.⁷ From the 1890s onwards, larger mills also began supplying electricity to neighbouring enterprises or public grids. This diversification strategy ensured the survival of certain mills, which developed into large-scale operations,⁸ such as the Lugitsch family business in south-eastern Styria, which today is the largest electricity producer in the region and operates one of Austria’s largest feed mills (see the case studies below).⁹

2.2. Papermaking

1In the northern regions of the Alps, the first paper mills emerged towards the end of the 14th century. In Austria, the earliest documented mill was established in Lower Austria in 1469. The first Styrian paper mill was likewise founded in the 15th century, near the city of Graz¹⁰ – the Leuzendorf paper mill, which was purchased in 1793 by the printer and publisher Andreas Leykam and subsequently became the foundation of the largest paper manufactory in the Habsburg Monarchy – the later Leykam-Josefsthal AG.¹¹ The rise of book printing led to growing demand for paper, prompting the establishment of numerous new paper mills. As part of the modernisation measures initiated by Empress Maria Theresa from 1754 onward and carried on by her son Joseph II, paper production quadrupled by 1798. However, shortages of rags and labour, as well as water scarcity and the freezing of rivers in winter, hampered production.

2Most newly founded paper mills were built along rivers, which provided both the necessary motive power and a timber supply via rafting. From the 1860s onward, paper began to be produced from wood fibres, and the abundance of forests in Styria became a decisive locational advantage for the expanding paper industry. In the following decades, numerous wood-grinding, cellulose, and pulp factories were established.¹² One enterprise that evolved from a paper mill into a paper factory during this period was Johann Koch’s Pöls paper mill–today known as Zellstoff Pöls AG, the oldest paper producer in Styria (more on this below).¹³

2.3. Hammermills

1It is believed that the first water-powered hammer in Styria was operated by the Benedictine Abbey of Admont at the end of the 12th century. However, the earliest documented water hammer dates to 1290 in the Enns Valley.¹⁴ Between 1180 and 1290, iron ore processing increasingly shifted from the mountains to the valleys’ waterways, where water wheels powered bellows and forging hammers. By 1260, Styria’s iron industry was beginning to take shape – likely driven by shortages of charcoal and labour, which necessitated establishing hammer mills away from the Erzberg, along the Mur-Mürz Furrow and in the Enns Valley. The production centres of Vordernberg and Innerberg (modern-day Eisenerz) became focal points of this industry. In the 16th century, many iron hammers were converted into scythe hammers. High demand for scythes in the agricultural regions of the East and Southeast drove this transformation. Scythe hammers required less water and could therefore be established along smaller, less water-rich rivers in the valleys. However, as industrialisation favoured the accumulation and expansion of larger factories, smaller hammer mills began to fall behind. By the 1830s, competition from the increasingly dominant English iron and steel production had intensified. In response, Archduke John of Austria advocated the consolidation of Styria’s iron industry, a process realised only in 1881 with the founding of the Österreichisch-Alpine Montangesellschaft (Austrian Alpine Mining Company, ÖAMG).

2From the 1850s onward, the expansion of the Southern Railway improved access to coal, and steam power gradually replaced water power. By 1900, water power had been almost entirely displaced as a primary energy source, with only small-scale operations continuing to rely on it. However, water power returned in a modified form: water turbines were used to drive generators, producing electricity for iron and steelworks. In 1900, the ÖAMG constructed its own hydroelectric power plant for the Donawitz Steelworks on the Mur River to supply electricity for its operations.¹⁵ Small hammer mills could no longer compete in iron and steel production unless they occupied niche markets, as exemplified by Mosdorfer GmbH in Weiz, eastern Styria (more on this later in this paper).

3.1. Herbert Lugitsch u. Söhne Ges.mbH and E-Lugitsch Elektro GmbH

1In 1909, the miller and sawmill operator Florian Lugitsch acquired the estate of the Löscher family in Gniebing, southeastern Styria, which comprised a grain and oil mill, agricultural land, and a small hydroelectric plant. Previously, he had operated a mill and sawmill in nearby Grasdorf, also in southeastern Styria. Recognising the river Raab’s greater hydroelectric potential and the site’s existing railway connection, he opted to purchase the Löscher mill. Lugitsch had already grasped electricity’s transformative potential and, by 1913, had electrified the local railway station. Simultaneously, he secured early supply territories – and thus consumers for his self-generated power – by extending the network to the surrounding villages.¹⁶

2In the final weeks of World War II, combat occurred directly at the mill: the bridge and weir of the hydroelectric plant were blown up, the mill building was damaged by shellfire, and inventory, including grain, had been removed. Nevertheless, the hydroelectric plant and the mill were hastily restored to operation. In the face of acute food shortages, the Lugitsch family was able to provide flour, meat products from sheep husbandry, and electric power for themselves and parts of the surrounding region. The high demand for the family enterprise’s products¹⁷ during post-war reconstruction and the economic boom that began in the late 1940s¹⁸ propelled the business into rapid growth. Ten years later, the company began offering electrical installations, driven by the conviction that survival could not rely on electricity generation alone. Soon after, an electrical supply store was opened, initially focusing on selling electric motors to farmers and household appliances. To ensure the necessary voltage for motor operation, the distribution network was upgraded accordingly.

3At the same time, the company entered the animal feed sector, building a feed mill for poultry and pigs. At the end of the 1960s, the family business suffered a serious setback when a batch of feed was found to be contaminated with toxins. The affected feed and raw materials had to be destroyed, and the facilities thoroughly cleaned, halting production for a month. The incident eroded trust, which customers exploited to demand significantly lower prices. In response, Lugitsch decided to take over the slaughtering and sale of poultry themselves. The crisis was thus turned to their advantage, as evidenced by the expansion that began in 1971. Five years later, Lugitsch acquired an old estate, on which a layer-hen facility for 35,000 birds was established. Simultaneously, the mill was fully automated, and the grinding rights of three other mills were acquired. In 1982, a second hydroelectric plant was constructed south of the original facility. This expansion-driven growth brought about structural transformation. Although the agricultural and electrical divisions were managed by different family members, the company’s increased scale necessitated the formal separation of the enterprises. From 1984, Herbert Lugitsch managed the Herbert Lugitsch OHG (from 1989, Herbert Lugitsch u. Söhne Ges. mbH), overseeing meat and feed production (feed mill), while his brother Florian ran the Florian Lugitsch OHG (today E-Lugitsch Elektro GmbH), responsible for electricity generation, electrical installation, and trade.

4The year 1991 marked a pivotal moment in the company’s history, once again guided by strategic foresight and careful assessment. Austria’s impending accession to the European Union heralded the abolition of the so-called mill quota system – a fixed allocation of grinding rights – effectively liberalising the market. Anticipating that this would displace small mills in favour of industrial-scale operations, Lugitsch made the strategic decision to discontinue grain milling.¹⁹ History proved him right: whereas in 1995 there were still some 300 grain mills in Styria, by 2024 only a handful remained.²⁰ The proceeds from the sale of the grain mill were reinvested – in the expansion of poultry processing and in the installation of the first pasteurisation plant in Europe within a feed mill. Investment momentum continued: in 1996, E-Lugitsch Elektro GmbH made its first investment in a photovoltaic system. In 1999, Herbert Lugitsch u. Söhne Ges. mbH acquired two feed mills and, once again, converted them into the first and, to this day, the most advanced organic feed mill in Europe. Steady investments in production facilities and structural expansion followed, generating further growth.

5In 2001, Herbert Lugitsch u. Söhne Ges. mbH acquired a stake in an energy firm and took over an egg production operation. By 2004, E-Lugitsch Elektro GmbH had opened an electrical installation business in Croatia, marking the company’s first step abroad. Subsequent acquisitions of two electrical installation and retail companies followed in 2008 and 2020. This long series of expansionary undertakings attests to the sustained success of the enterprises.²¹

3.2. Zellstoff Pöls AG

1Zellstoff Pöls AG is the oldest paper mill in Styria and the largest producer of speciality pulp and speciality papers in Central Europe.²² The company’s origins date back to 1700, when a paper mill commissioned by Prince Ferdinand von Schwarzenberg was completed on the Reifenstein estate – from then on, it was known as the “Reifensteiner paper mill”. Over the next three centuries, the mill frequently changed lessees, and only minimal investment was made in modernisation. As a result, following Empress Maria Theresa’s 1749 patent liberalising the paper industry, the mill was unable to keep pace with other paper producers. Like its competitors, it suffered from a chronic shortage of the most essential raw materials – rags and tatters. Its survival was secured only by a supply contract with the Graz government offices for chancery paper. Between 1867 and 1870, operations ceased entirely. Only after Johann Koch acquired the mill was production brought up to contemporary technical standards and the facility transformed into a factory. The installation of steam boilers, a new waterwheel, and a water-supply pumping system, together with the transition from rags to wood as the primary raw material – a decisive locational advantage in the forest-rich province of Styria – enabled the Pöls paper factory to catch up with its competitors²³ and establish itself among the eight remaining paper producers in Styria.²⁴ In 1888, a fire destroyed the entire factory, yet the owner, Johann Koch, turned the catastrophe into an opportunity to modernise and even expand the facility. He shifted production towards durable, high-quality grades of paper – a product line that continues to this day. However, the heavy investment costs overstrained Koch’s finances, and in 1901 he was forced to sell the mill to the Graz merchant David Stern, who, for similar reasons, sold it again just two years later to the Moravian industrialist Alfred Friedemann. Friedemann acquired numerous new machines, financing them almost entirely through debt. When the factory’s sales declined, he was unable to meet his creditors’ demands, and in 1910 ownership of the Pöls paper factory passed to the Styrian Escompte Bank.

2During World War I, production came to a halt due to a shortage of labour until the firm Moritz Mauthner & Sohn took over operations in 1917. Once again, the new owner undertook substantial investments, including the construction of a cableway linking the factory to the railway loading station. Yet once more, a lack of capital led to failure, as the collapse of the Habsburg Monarchy eliminated a large portion of the company’s market. The factory continued to operate at a loss.

3A turning point came in 1921, when the North Italian industrialist Luigi Burgo purchased the struggling plant to supply pulp to his Italian paper mills. The Italian paper industry faced a shortage of domestic timber, while Styria’s abundant forests ensured Pöls a stable market in Italy and thus its survival. Over the next six decades, the company prospered – thanks largely to the Burgo Group’s investments in the 1920s and 1930s and to capital infusion from the United States’ European Recovery Program (ERP, also known as “the Marshall Plan”) in the postwar period.²⁵ The “oil price shock”, triggered by OPEC’s restriction of oil production after the Yom Kippur War in 1973, marked the beginning of the so-called “corrugated business cycle” (Wellblechkonjunktur) in Austria²⁶ – high raw material prices and insufficient production capacity also weakened the Pöls paper factory. At the same time, the emerging environmental movement drew attention to the significant ecological impact of the paper industry, which was responsible for severe pollution due to high CO₂ and sulphur dioxide emissions, as well as the discharge of toxic acids and lignin into rivers.

4With substantial financial support from the Republic of Austria, the State of Styria, and the nationalised industry (VOEST-Alpine) – largely prompted by the federal government under Chancellor Bruno Kreisky – construction of a sulphate pulp mill began in 1980, to markedly reduce these environmental burdens. Liquidity problems within the Cartiere Burgo Group increased the state’s expenditure. Ultimately, the Italian management was replaced by Austrian executives, and the long-standing majority owner sold his shares to the national and Styrian governments. Construction costs for the sulphate pulp mill escalated, and technical difficulties during commissioning led to substantial corporate indebtedness. In 1984, the state industrial holding ÖIAG (Österreichische Industrie-Holding AG) acquired 90 per cent of the shares.

5As part of the restructuring and rehabilitation of the entire nationalised industry, the Pöls pulp factory was sold in 1988 to the Carinthian multinational Frantschach AG. With the rise of the Green political movement, the severe environmental impacts of the paper industry became a focal point of public debate. The company invested in more environmentally friendly processes to enhance productivity. Major investments included installing a biological wastewater treatment plant, adopting gentler chemical pulping methods, and improving water treatment. By the mid-1990s, these measures proved effective: Pöls had established itself as a low-cost producer of heavy-duty and speciality papers in Europe.²⁷

6In 2000, the next change of ownership occurred when the Austrian Heinzel Group acquired the Pöls pulp factory.²⁸ The acquisition was motivated by the site’s specialisation in high-quality speciality and heavy papers, which the group sought to integrate into its portfolio. The strategic objective was to secure the location in the long term, achieved through investments to increase efficiency and productivity and to ensure a high level of energy self-sufficiency. Under the “Pöls 500+” project – referring to the production of over 500,000 tons of paper annually – a biomass power plant and a hydroelectric plant were constructed, raising the self-sufficiency rate to 90 per cent. Productivity improvements were further supported by the acquisition of a majority stake in a pulp mill in Paskow, Czech Republic,²⁹ and the installation of new paper machines in 2013 and 2019.³⁰

7Under Heinzel Group management, the oldest paper mill in Styria consolidated after two turbulent decades and emerged as Central Europe’s leading producer of speciality pulp.

3.3. Mosdorfer GmbH

1Mosdorfer GmbH – the parent company of today’s Knill Group – is a family enterprise based in Weiz, eastern Styria, with a history spanning more than 350 years. It has evolved from a blade smithy into an international corporation specialising in the production, installation, and maintenance of fittings for overhead transmission lines in the energy and railway sectors, as well as in electrical distribution cabinets.³¹ The group employs nearly 1,500 people worldwide.³² Around 150 people work at the company’s site in Weiz, which dates back to the 15th century.³³

2The oldest iron hammer forge on the Weizbach is documented from 1425, when the Krottendorfer family of smiths operated a blade forge there. Conditions for ironworking in the Weiz region were highly favourable: abundant forests provided charcoal, the local ore was of good quality, and the warm tributary feeding the Weizbach ensured ice-free water throughout the year. From 1577 onward, the blade smithy supplied the Styrian Estates with weapons to defend against Ottoman incursions.³⁴

3In 1712, the Bavarian swordsmith Josef Mosdorfer acquired the forge, marking the beginning of the Mosdorfer-Knill family enterprise.³⁵ The fine reputation of Weiz blades soon attracted major orders from the imperial court in Vienna. During the War of the Austrian Succession (1740–1748) and the Seven Years’ War (1756–1763), several cavalry regiments of the imperial army were equipped with sabres, while the infantry received bayonets and gun barrels.³⁶

4In 1784, Anton Mosdorfer expanded the workshop by adding a scythe forge, convinced that manufacturing swords, bayonets, and barrels alone would not ensure the company’s long-term survival. This foresight and decision to diversify proved remarkably astute in light of later developments in weapons technology. By 1800, the forge was producing more than 130,000 scythes annually, and scythe-making had become its principal business.³⁷

5Balthasar Mosdorfer, representing the next generation, diversified further, establishing in 1833 a refining hammer forge to shape iron rods, bars, and sheets for further processing. In 1847, he built a second sickle hammer on the Weizbach, increasing production to over 200,000 scythes. In 1862, Mosdorfer acquired an old horseshoe forge and converted it into a flattening hammer mill, where metals were smoothed and formed for various uses.

6From 1868 onwards, the Weizbach forges adopted the newly invented Bessemer process for steel production. This innovation enabled the direct forging of cast workpieces, for which Styrian iron – unlike that from the Rhineland and Westphalia – was particularly well suited.³⁸ Production costs fell considerably, and by 1870, 386,650 scythes were being forged and exported to Bohemia, Moravia, Germany, Hungary, and even America.³⁹

7In 1890, the family enterprise was divided between the brothers Franz and Josef. Franz took over the large and tool hammer works, where anvils, ship anchors, and a range of forged tools, both large and small, were produced, while Josef managed the sickle factory. Following Franz’s death in 1905, his branch of the business dissolved, whereas under Josef’s successor, Moriz Mosdorfer, the scythe factory expanded significantly. In the 1920s and 1930s, Mosdorfer exported sickles and scythes to South America, the United States, and across Europe.

8During World War II, Mosdorfer manufactured axes, sickles, and scythes for Austrian and German agriculture, employing prisoners of war as labourers. The immediate postwar years brought a short-lived boom: as agriculture revived, demand for scythes surged. Yet from 1948 onward, as mechanisation spread through farming, demand fell sharply. In this precarious period of transition, the company sought new strategies – producing knives, forks, pliers, hoes, harrows, and other tools. By 1950, Mosdorfer was even manufacturing machetes, which initially sold very successfully in Mexico and Argentina. However, in 1956, 40 per cent import duties were imposed, bringing the machete venture to an abrupt end.

9Salvation, however, had already arrived in 1949. Despite lacking the necessary expertise and production capacity, Mosdorfer was awarded the contract to manufacture components for the high-voltage transmission lines of a section of the Kaprun hydroelectric power plant in Tyrol.⁴⁰ The engineer Friedrich Knill – husband of the company’s heir, Herta Mosdorfer – who had led the company since 1938 and had acquired electrical engineering expertise through his work at the motor manufacturer ELIN in Weiz⁴¹ – was able to bring the project to a successful conclusion, marking the beginning of a completely new – and still ongoing – product focus. In 1956, the remaining stock of sickles, axes, and other inventory from the sickle forge was sold. From then on, the forge produced components for high-voltage transmission lines, which were delivered to Syria, India, Pakistan, Belgium, the United States, Germany, and Bulgaria. In the same year, Friedrich Knill became a partner in the company; from then on, the Knill family managed its operations.

10By the 1970s, Gunther Knill had taken over the family business. He introduced new production methods and expanded the factory premises to meet rising order volumes. In 1982, a hot-dip galvanising facility was established, laying the foundation for a new business segment: galvanising services for third parties.

11A strategic milestone was reached when Mosdorfer acquired a major competitor, the Vorarlberg-based company Lorünser, which had extensive expertise in producing fittings for overhead transmission lines. This acquisition marked the start of an expansion phase characterised by numerous takeovers and equity investments. The majority stake acquired in 1986 in a local bakery machinery manufacturer was motivated by a weak order situation, with diversification intended to offset the downturn.

12Due to low-capacity utilisation, the company expanded into the United Kingdom by acquiring Lorünser’s product representation there and selling products specifically developed for the British market. The following year, a sales office was opened in the Federal Republic of Germany. Another diversification step – one that proved successful – was the acquisition of an electrical engineering company in Vienna, specialising in cable and power distribution boxes. The company, renamed Elsta-Mosdorfer GmbH, marked the group’s entry into the energy transmission sector.

13Following these steps in market penetration, expansion and diversification, the production of labour-intensive electrical products was relocated to Slovakia, where a new plant was established. A year later, Knill-Holding GmbH, by then a fully fledged group, acquired two insolvent companies of the Assmann Group in south-western Styria, which manufactured plastic cable distribution boxes – until then, Mosdorfer had produced only metal boxes. The company also acquired the Swiss EA Elektroarmaturen AG in Schaffhausen to strengthen its market penetration in Switzerland.⁴² The group further increased its market share in the cable sector by acquiring the Lower Austrian company Rosendahl Maschinen GmbH – at the time the world’s second-largest manufacturer of cable machinery – and the German firm Frisch Verseilmaschinen GmbH. In the cable and wire segment, the Knill Group continued its expansion strategy in 1998 and 1999 by acquiring five additional companies in England, France, Germany, and Poland.

14The course remained firmly set on growth. To implement this strategy more effectively, the group was reorganised into a three-part holding structure: ETK (Electrical Engineering), KDS (Cable and Wire Systems) – which included the parent company Mosdorfer – and BTK (Bakery Technology), which was later integrated into the KDS segment.⁴³ In 2008, the company joined the ranks of the world’s leading suppliers of fittings for overhead transmission lines through the acquisition of the Italian specialist in vibration dampers, DAMP Srl., and the establishment of the subsidiary Mosdorfer India GmbH, marking its entry into the Indian market. The most recent acquisition in 2021 opened yet another sales market: the railway division of the German Pfisterer Group. Renamed Mosdorfer Rail, the subsidiary now produces line systems, insulators, and connectors for the rail and metro sectors.⁴⁴

4.1. The advantage of the early mover

1It can first be stated in general terms that the foundation of entrepreneurial success in the early years of these companies rested on the energy source of water and the right – that is, the necessary licences – to use the water for the respective purpose, without which the respective business models would not have been viable and which gave all three of them a crucial advantage – the advantage of the first or early mover, as Porter suggests.⁵¹ Even as hydropower was increasingly displaced by coal, it re-emerged indirectly: in the case of the family-owned company Lugitsch, through electricity generation, which constitutes a “secure sales base” in the company’s history.

2Similarly, Zellstoff Pöls AG built a new hydropower plant in the 1990s to achieve a high degree of self-sufficiency in the energy-intensive paper production process, thereby keeping production costs low. For Zellstoff Pöls AG, the “advantage of the early mover” is further reinforced by the long-term advantage of its location, specifically the early establishment and modernisation of the production site, which made the paper mill attractive to major investors. The long-term survival of Zellstoff Pöls is also attributable to the strategic decisions of the respective management teams. However, one must ask whether it is more appropriate to speak of continuity of the site rather than continuity of the company itself, especially in light of the comparatively frequent changes in ownership. In this context, it is important to emphasise that Lugitsch and Mosdorfer remained family-run businesses throughout their history. In contrast, Zellstoff Pöls was subject to constant changes in ownership from the very beginning.

3In the case of Mosdorfer GmbH, hydropower no longer served directly as an energy source but rather as an “indirect” strategic turning point: the order to produce overhead line components for the Kaprun storage power plant marked the start of a strategic realignment⁵² that enabled the company to occupy a niche, which has since underpinned its remarkable growth.

4.2. Focus or niche positioning and differentiation

1All three companies share the characteristic of consciously or unconsciously pursuing a strategy of achieving niche positioning throughout their histories. However, the significance of the concept of a “niche” varied with the temporal context. The founder of the Lugitsch family business, Florian Lugitsch, recognised the potential of electricity as early as 1909 and chose to enter the power supply sector – a true niche market at that time. In agriculture, the company occupied the organic segment early on, selling off milling rights in 1995 in anticipation of EU accession and, from 1999, becoming the first feed mill in Europe to produce organic animal feed.

2Reifensteiner Paper Mill survived into the industrial age only by occupying a niche: supplying chancery paper to the Graz court. When transitioning from rags to wood pulp as the raw material for paper, the moderniser Johann Koch’s 1870 decision to specialise in solid board alongside pulp production created a market niche that remains central to the company today. In both areas, pulp and speciality paper, the company emphasises very high quality and customer-specific production. In this context, the company seeks to further distinguish itself within the niche market through differentiation.

3Mosdorfer GmbH likewise occupied a niche market in its early years, enjoying the privilege of supplying high-quality blades, sabres, bayonets, and gun barrels to the Styrian Estates and, later, the imperial army. Its current core business – manufacturing overhead line fittings – exemplifies a niche strategy. Within this niche, Mosdorfer further diversified by integrating business areas closely aligned with its existing expertise, such as the construction of railway line systems.

4.3. Diversification⁵³

1Diversification strategies are most pronounced in Lugitsch’s history, somewhat less so at Mosdorfer, and virtually absent at Zellstoff Pöls, where diversification occurred only once, when Johann Koch decided to enter solid board production in 1870 (see above). Diversification is deeply rooted at Lugitsch; upon acquiring the mill and the power plant in 1909, the company already encompassed both agriculture and electricity. Both areas saw further diversification over time: in electricity, with entry into electrical installation and trade in the late 1950s; in agriculture, through feed production in the same decade and the 1971 decision to produce market chicken meat independently, thereby reducing dependence on trade. Lugitsch leveraged its experience in sales and poultry farming when acquiring an egg producer in 2001. The switch to organic feed and high-quality organic chicken production marked the final step of this vertical diversification strategy, covering the entire production process from feed to end product.

2Mosdorfer’s first diversification occurred in 1784, when Anton Mosdorfer anticipated the long-term decline of the armaments forge and began producing scythes (thereby serving both civilian and military demand). Under Balthasar Mosdorfer, further steps were taken, including the establishment of forges for various iron products such as anvils, ship anchors, rods, and pipes. During the post-World War II technological transformation in agriculture, the company attempted to sustain itself by producing a wide range of agricultural implements, including a rather peculiar episode involving the export of machetes. The breakthrough came almost by chance when Friedrich Knill successfully completed the Kaprun storage power plant order, leveraging his electrical engineering expertise and the company’s collective blacksmithing know-how. The introduction of bakery machinery production in 1982 arose from concerns over poor order levels, yet the company remained anchored in its technological core, entering electricity distribution through the production of distribution cabinets.

4.4. Expansion

1Expansion strategies were particularly significant for Mosdorfer GmbH and Lugitsch, whereas Zellstoff Pöls served as an expansion vehicle within the corporate structure. Lugitsch built a regional electricity network as early as 1913, which was continually expanded. The electrical installation, electrical trade, and agricultural divisions grew through the acquisition of smaller regional companies. The opening of a branch in Croatia in 2004 was an exception.

2Acquisition-driven expansion played no role in Zellstoff Pöls AG’s history, as recurring liquidity issues periodically threatened the company’s continuity. Growth occurred only through productivity gains, achieved through prior modernisation – particularly under Johann Koch (1870–1905) and, from the 1920s until the late 1970s, under Cartiere Burgo. The structural crisis of the 1980s was overcome only through substantial state support. The acquisition by Frantschach AG further stabilised the company. It was only when the Heinzel Group purchased the paper and pulp mill in 2000 that significant productivity-driven growth resumed, driven by cost-reducing investments in energy infrastructure and productivity-enhancing measures, such as the purchase of new paper machines.

3Mosdorfer’s productivity growth was already evident under Balthasar Mosdorfer, who significantly boosted scythe production by introducing the Bessemer process, enabling worldwide exports. Acquisition-driven expansion began only in 1985, with Gunther Knill’s takeover of competitor Lorünser. From that point, the company pursued a consistent strategy of market share growth, primarily through the acquisition of competitors and technological leaders. The results of this expansion are impressive: 25 locations in Europe, three in Asia, two in the Americas, and one in Australia.