Legendary Ranching Empire Facing Modern Corporate Reality
Nov. 30, 1987
KINGSVILLE, Texas (AP) _ Texas' depressed economy has forced drastic changes on the famed King Ranch, which has brought in outside managers to help oversee the 134-year-old family empire that once hired cowhands for life.
The spread that Richard King cut out of South Texas brushland in 1853 amid shootouts with Indians and cattle rustlers has sold land, cut its workforce by more than half and diversified into such markets as shrimp and sugar cane.
Rafael Silva represented the fourth generation of his family to work on the Rhode-Island-sized King Ranch, until he was laid off May 5.
''Under new management, they got their own ideas, and I guess they just didn't have a place for me any more,'' said Silva, 32, who grew up on the ranch and attended school in the Santa Gertrudis Independent School District on the ranch.
On Nov. 11, the King Ranch Inc. board of directors elected three new board members who are not relatives or in-laws of either King or his son-in-law, Robert Justus Kleberg II.
Although the operation remains private, the move was the first time in the ranch's history that the reins were handed over to someone outside the family. Nine family members are still on the board.
''It's not just a cattle-raising or horse-raising operation,'' said Donald Nixon, professor of agricultural economics at Texas A&I University in Kingsville. ''It's a large, diversified corporation.''
Two of the new directors are chief executives of major Dallas-based corporations - Charles Blackburn, chairman of Maxus Energy Corp., and Darwin E. Smith, chairman of Kimberly-Clark Corp.
The third new member, William D. Sanders, heads Chicago-based LaSalle Partners.
John B. Armstrong, president and chief executive officer of the King Ranch, said through a spokesman that he believed the outsiders would bring ''greater insight and diversity of experience to the board.''
Faced with tough times for its traditional mainstays - cattle and oil - the ranch has cut the work force at its 825,000-acre operation from 700 to 325 since 1984 through layoffs or early retirement.
Along with the land the corporation devotes to cattle, quarter horses and farming, the company is involved in various domestic oil, gas and real estate- related interests.
King Ranch has begun developing a shrimp farming operation on its coastal land.At its Big B Ranch in Florida, it sold all its horses and cattle and replaced them with sugar cane.
But while it has further diversified, the company has sold its land in Spain, Venezuela and Argentina, and in Pennsylvania.
''They are no different from any other major corporation,'' said Dick Messbarger, executive director of the Kingsville Chamber of Commerce. ''They've just been through some tough times.''
King Ranch spokesman John A. Cypher Jr. said modern innovations - cattle roundups are conducted by helicopter - enable the ranch to run with fewer people, a blow to loyal workers who used to depend on lifetime employment and subsidized housing.
Silva said he still feels proud to say he worked at King Ranch, which he said ''educated me to the ways of life.''
''I lived such a sheltered life working for the ranch, I was scared when I first got out,'' said Silva, who lives in Kingsville and works as an insurance salesman.
King started the empire with 15,500 acres in an area known at the time as the Wild Horse Desert. Soon afterward, he persuaded an entire Mexican village to move there. The ranch continued to grow and at one point was nearly 1.2 million acres.
In 1940, the Department of Agriculture recognized the ranch for developing the Santa Gertrudis, the first beef breed produced in this country.