Koch Industries

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Koch Industries, Inc.
Type Private
Founded 1940
Headquarters Wichita, Kansas, USA
Key people Charles G. Koch, Chairman, CEO, and half-owner
David H. Koch Executive vice president, and co-owner with Charles Koch
Industry Conglomerate
Products Petroleum
Chemicals
Energy
Asphalt
Natural Gas
Plastics
Fibers
Minerals
Fertilizers
Ranching
Pulp and Paper
Finance
Commodities Trading
Revenue ▲$106 billion USD (Estimate)
Employees 80,000 (11.08.2007)
Website www.kochind.com

Koch Industries, Inc. (pronounced "koke") is a private corporation based in Wichita, Kansas with subsidiaries involved in manufacturing, trading and investments. Koch companies are involved in core industries such as commodities trading, petroleum, chemicals, energy, fiber, intermediates and polymers, minerals, fertilizers, pulp and paper, chemical technology equipment, ranching, securities and finance, as well as in other ventures and investments. It is the largest private company in the United States, and has an annual revenue of about $90 billion.[1][2]

Fred C. Koch, for whom Koch Industries, Inc. is named, co-founded the company in 1940 and invented an innovative crude oil refining process. His sons, Charles G. Koch, chairman of the board and chief executive officer, and David H. Koch, executive vice president, are principal owners of the company. Charles Koch owns 40% of Koch Industries, and has stated that the company will publicly offer shares "literally over my dead body".[1]

Contents

[edit] Acquisitions and related milestones

The following is a partial list of acquisitions and related events:

  • 1940: Fred Koch co-founds Wood River Oil and Refining Company.
  • 1946: The company acquires Rock Island Oil & Refining Co. in Oklahoma.
  • 1959: The company changes name to Rock Island Oil & Refining.
  • 1959: Fred Koch purchases 35% equity position in Great Northern Oil Company in St. Paul MN, sight-unseen.
  • 1967: Koch's death prompts the company, now led by Charles Koch, to be named Koch Industries in honor of its co-founder.
  • 1969: Charles Koch and J. Howard Marshall II pool equity positions to obtain majority of Great Northern Oil Company. After 100% equity was obtained, the refinery was renamed Koch Refining.
  • 1977: Koch acquires 100% of equity in Abcor and later renamed it as Koch Membrane Systems in 1985
  • 1981: The company acquires refinery in Corpus Christi, Texas, from Sun Oil.
  • 1986: The company acquires the C. Reiss Coal Company.
  • 1989: The company purchases the assets of the John Zink Company.
  • 1992: The company acquires United Gas Pipeline.
  • 1993: Elf Asphalt is acquired.
  • 1997: The company acquires Delhi Group.
  • 1998: Purina Mills is acquired.
  • 1998: The company forms KoSa after acquiring 50 percent ownership of Hoechst's polyester division.
  • 2000: A U.S. Bankruptcy court cancelled out all equity in Purina held by Koch, in order to maintain Purina's viability.
  • 2001: The company partners with Entergy Corporation to form the limited partnership Entergy-Koch, which includes Koch's United Gas Pipeline subsidiary.
  • 2003: Acquired fertilizer division of bankrupt Farmland Industries
  • 2004: Koch acquires the INVISTA fibers and resins business from DuPont. Entergy-Koch is sold.
  • 2005: Koch acquires Industrie Meccaniche di Bagnolo S.p.A. and later renamed it as Koch Heat Transfer Company S.r.l..
  • 2005: Koch acquires Georgia-Pacific, its largest acquisition ever, and surpasses Cargill as the largest privately owned U.S. company.
  • 2005: Koch acquires Puron AG, a water treatment membrane producer from Aachen, Germany[3].

[edit] Political activity

The Koch brothers also operate the Koch Family Foundations, a major source of funding for conservative and libertarian political causes in the United States, including think tanks such as the Cato Institute. (Their father helped found the John Birch Society, though neither brother is a member or supporter of the organization.) David's political activism also includes running as the vice presidential nominee of the United States Libertarian Party in 1980, when he and running mate Ed Clark finished fourth with 921,299 votes.

Koch also supports Americans for Prosperity, formed as a successor to Citizens for a Sound Economy. Rich Fink, a Koch executive vice president, is a member of the board of directors of Americans for Prosperity. Previously he served as president of Citizens for a Sound Economy.

In April of 2006 , it was announced that the Fred C. and Mary R. Koch Foundation had contributed $1 million to help preserve the tallgrass prairies of the Tallgrass Prairie National Preserve in Chase County, Kansas. The donation made to the Kansas Prairie Legacy Campaign is reportedly the single largest private donation in the State's history. Currently Liz Koch is the president of the Fred C. and Mary R. Koch Foundation, and has been reported as saying that the Flint Hills of Kansas were a special place for Fred C. Koch, who died in 1967, and Mary R. Koch, who died in 1990. The Flint Hills is where their ashes were spread and their headstones placed. The $1 million donation was made as a special way to honor the love Fred and Mary had for the Kansas Prairie.[4]

[edit] Criticism

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In 1989, the Democratic-controlled U.S. Senate Committee on Investigations claimed that "Koch Oil, a subsidiary of Koch Industries, is the most dramatic example of an oil company stealing by deliberate mismeasurement and fraudulent reporting." (Palast p.150) During the Clinton administration, Koch was charged with 315 acts of pollution, especially at its Pine Bend Refinery facility in Rosemount, Minnesota. Koch Industries denied the allegations, and the cases were settled in January 2000 for $35 million in fines.

Koch was separately charged with 97 counts of covering up evidence in the case of a benzene spill of 91 metric tons in Corpus Christi, Texas. The government sought fines as high as $350 million. Four of its employees were also charged individually with criminal offenses in the case, facing up to 35 years in prison. During this time, Koch donated $800,000 to the Bush election fund and other Republican candidates. In 2000, the Justice Department under President Clinton reduced the number of counts from 97 to 11 to nine to seven. Just before the case was to go to trial, the Justice Department dropped the remaining seven counts and settled the case for $20 million. Koch pled guilty to one count of concealing evidence, which they in fact had self-reported in 1996, and the criminal charges against the employees, personally, were dropped.

[edit] See also

[edit] References

[edit] Notes

  1. ^ a b Fisher, Daniel (Mar. 13, 2006). "Mr. Big", pp. 24–26. Forbes. Online summary at [1].
  2. ^ Forbes - America's Largest Private Companies
  3. ^ http://www.sciencedirect.com/science?_ob=ArticleURL&_udi=B6VJF-4FJ5PGD-1&_user=10&_rdoc=1&_fmt=&_orig=search&_sort=d&view=c&_acct=C000050221&_version=1&_urlVersion=0&_userid=10&md5=90c7f75373993289925ca5d531026643 Accessed: 27 February 2008
  4. ^ Klepper, David (Apr. 05, 2006). "Campaign to preserve tallgrass prairie gets $1 million boost" The Kansas City Star.

[edit] External links

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