Baburizza: A Business Group in Chile in the First Half of the Twentieth Century

Abstract

Diversified business groups are the dominant organisational form in the corporate sector in Chile, and Latin America more generally. The group of companies led by Pascual Baburizza, a Croatian immigrant who arrived in Chile in 1892, was one of the largest in Chile during the first half of the twentieth century, with investments in finance, mining, agriculture and manufacturing. The Baburizza group differed from classic examples of family groups, as its ownership structure and senior management incorporated several families, usually with Croatian roots. This chapter shows how Pascual Baburizza was able to overcome his humble immigrant origins to become one of the most important actors in the nitrate industry by 1925. After 1929, and the sale of his Lautaro company to the Guggenheims, Baburizza shifted his interests towards other sectors of the Chilean economy, in particular agriculture, and newer areas of enterprise such as hotels and tourism. The chapter illustrates the use of vertical integration and interlocking directorates as a means of coordinating activities among related firms. His lack of heirs meant that the group disappeared after Baburizza’s death in 1941 although some of his Croat associates went on to establish other linked enterprises.