Walton family keeps hand on the business - Sam Walton, Wal-Mart business

Discount Store News, Dec 5, 1994

The family of Wal-Mart founder Sam Walton still looms as a powerful presence in the corporate life of Wal-Mart Stores; the family trust holds almost a 38% controlling interest in Wal-Mart stock.

The family trust owns 871.3 million shares, worth $20,47 billion, give or take.

That enormous vested interest means that the Walton family will continue to exert considerable influence over corporate affairs, regardless of how active--or inactive--a role family members play in the day-to-day running of the company.

Helen Walton, Sam Walton's widow, is a trustee of the family trust, along with their sons Rob, John and Jim and daughter Alice. That influence will continue at least until the year 2000, when the family trust is set to expire.

In addition to financial control over the corporation, three family members hold corporate positions: Rob, the oldest son, of course, is chairman; James (Bud), Sam's brother and co-founder of Wal-Mart, is a senior vice president who also sits on the Wal-Mart board; and son John who, like Rob and Bud, is a Wal-Mart board member.

Rob Walton, 50, is far from being a figurehead who inherited a cushy job. Rather, Sam Walton's oldest son is taking an active role as chairman, especially in the fields of real estate and expansion into China.

For instance, Rob Walton arranged for a company jet to fly China's minister of internal trade, Zhang Haoruo, to Bentonville, Ark., in September for talks about investment in China.

In addition, Rob Walton flew to Hong Kong for the grand opening celebrations of Wal-Mart's first venture in Asia--two Value Club mini-clubs.

As one analyst put it, "Rob Walton is the voice of reason at Wal-Mart."

And from the corner office, he speaks with another voice, as family representative for the 38% stake in Wal-Mart that the Walton family trust controls.

Rob Walton, a lawyer, conceded that he's no Sam Walton. "I probably wouldn't be effective if I tried to be like Sam," he once said.

As chairman of his own company, Satloc Inc., son John has no role in corporate operations beyond his board position. Based in Casa Grande, Ariz., Satloc manufactures global positioning satellite systems. He also is vice president of Walton Enterprises II, a limited partnership that handles the personal investments of the Walton family.

Son Jim, although based in Bentonville, has no role in corporate affairs. Instead, he oversees family banking, newspaper and real estate businesses.

Daughter Alice, once a stockbroker, heads an investment firm she founded to make loans to small businesses and students.

Brother Bud also is a member of the Wal-Mart's six-man executive committee, along with Rob Walton, David Glass, Don Soderquist, Paul Carter and Drayton McLane.

In terms of corporate clout, however, Bud's position is regarded as low-key. Nominally, Bud Walton is in charge of Bud's Warehouse Outlet, the Wal-Mart division that converts small, old Wal-Mart stores into closeout units. In the early years of Wal-Mart expansion, Bud Walton handled the real estate.

Now 72, Bud Walton is well beyond normal retirement age.

"He's a kindly old gentlemen," one analyst said. "But likes to hunt a lot," another said.

As one indication of his relative position, Bud Walton doesn't rank among the top five executives in terms of pay and stock options for '94.

Nonetheless, Bud owns 40.2 million shares of Wal-Mart stock. His 1.75% stake makes him the largest individual shareholder in the corporation. Although still shy of being a billionaire, Bud Walton is "still the world's richest good ol' boy," Forbes magazine said in its Oct. 17 issue.

In addition to family shares held in trust, Helen Walton owns 1.5 million shares in her own name; Rob owns 402,574; John owns 2.8 million; Jim owns 4.6 million; and Alice, 1.1 million, the Wal-Mart annual meeting proxy statement reports.

Walton's widow, Helen, keeps busy by involving herself in several charitable activities, such as the Presbyterian Church and education, an analyst said.

Accordingly, she plays no active role in the corporation, he said, even though she is credited with having given a great deal of advice and suggestions while her husband was living.