(Bloomberg) -- David Koch’s death early Friday marks the end of an era in the worlds of business, politics, philanthropy and high society. For Koch Industries, the conglomerate he helped his brother Charles transform into the second-largest privately held U.S. company, the founding family retains firm control as a generational shift takes hold.
“Nothing changes,” Koch spokeswoman Christin Fernandez said in an email. “David’s shares remain with his family.”
Koch Industries won’t detail its succession plan beyond saying that one is in place, and that roles are filled by those most qualified. One candidate is Charles’s son, Chase Koch, 42. He’s the only member of the family from the next generation that works at the company. His sister Elizabeth Koch runs a publishing house, Catapult.
Chase oversees Koch Disruptive Technologies, a venture capital subsidiary that has invested in futuristic technologies including ultrasound-guided surgery and metal 3-D printing.
David Koch, who was 79, and Charles, 83, built Koch Industries from a minor oil player into a powerhouse with annual revenue of about $110 billion from businesses such as oil refining, pipelines, commodities trading, ranching and paper pulp that are at the heart of the American economy.
The two brothers -- with stakes of about 42% each -- have been the central figures in a firm as vast as it is stable. Charles has headed the company since 1967 and remains chief executive officer. Before retiring last year, David led Koch Chemical Technology Group.
The company is worth about $137 billion, according to the Bloomberg Billionaires Index. David’s stake comprised the bulk of his $59 billion fortune, which tied him with his brother as the world’s seventh-richest person.
Read more: Koch’s Massive Tech Bet: ‘Do It or We’ll End Up in the Dumpster’
Chase Koch took a somewhat unusual path to the firm. Unlike his father and uncle, both of whom studied chemical engineering at Massachusetts Institute of Technology, Chase studied marketing at Texas A&M University. After graduating, he spent several years in Austin trying to break into the city’s emerging tech scene. He moonlighted in a classic rock band covering Grateful Dead and Pink Floyd tracks.
When he returned to Wichita to rejoin Koch Industries, Chase began a rotation of high-level jobs, including stints in mergers and acquisitions, tax structuring, agronomics and trading. It was designed as an MBA-like experience to familiarize him with various parts of the operation.
If he does take over eventually, he’ll inherit a company with an impressive track record. His grandfather Fred Koch was an MIT-trained chemical engineer whose innovations in oil refining helped the firm flourish after he founded it in 1940. After his death in 1967, Charles took the helm, and David joined in 1970. At the time, the company was still a relative minnow that focused on oil refining and services.
Under their stewardship, Koch Industries reinvested about 90% of profits back into the business as it expanded into new sectors, such as fertilizers, fabrics and forestry products. Their purchase of Georgia-Pacific for $21 billion remains one of the biggest corporate acquisitions, and cemented Koch Industries’ position atop the ranks of the most valuable private companies whose main expertise was in turning raw materials into consumer products.
With David Koch’s death, his nephew’s role at the company is likely to draw more attention, as will the heirs who inherit shares. David is survived by his wife, Julia Flesher Koch, and their children David Jr., Mary, and John. Julia could become one of the richest and most influential figures in corporate America, assuming she inherits control of the estate.
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She has largely avoided the spotlight since marrying David Koch in 1996. She was born in Indianola, Iowa, in the early 1960s, and her family owned a furniture store, the New York Times reported in a 1998 profile. She moved to Arkansas eight years later when her parents opened a store in Conway, north of Little Rock. She attended the University of Central Arkansas before taking a job as an assistant to fashion designer Adolfo Sardina and ultimately being introduced to her future husband in 1991.
History is littered with examples of family ventures laid low by succession problems, but those familiar with the Kochs say they’re prepared.
“It is hard to see any scenario where this company falls apart or does poorly for any extended period of time,” said Christopher Leonard, author of “Kochland,” a new book about the firm. “They built a machine that will endure.”
--With assistance from Jeffrey Bair.
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