Chicago Bridge & Iron Company

CB&I
Public
Traded as NYSE: CBI
Industry
Founded 1889
Founder Horace E. Horton
Headquarters The Hague, Netherlands
Area served
 Worldwide
Key people
 Michael L. Underwood
(Chairman of the Audit Committee)
L. Richard Flury
(Non Executive Chairman of the Board of Supervisory Directors
Patrick K. Mullen
(President & CEO)
Revenue Decrease $ 6.7 billion (2017)[1][2]
Decrease $ -425.1 million (2015)[2]
Decrease $ -504.4 million (2015)[2]
Total assets Decrease $ 5.97 billion (2017)[1][2]
Total equity Increase $ 2.164 billion (2015)[2]
Number of employees
 >40,000 (June 2017)[3]
Website www.cbi.com
CB&I administrative headquarters
Chicago Bridge & Iron Works, 1912 catalog

CB&I was a large engineering, procurement and construction (EPC) company with its administrative headquarters in The Woodlands, Texas. CB&I specialized in projects for oil and gas companies.[4] CB&I employed more than 32,000 people worldwide.[5] In May 2018 the company merged into McDermott International.[6][7]

History

CB&I was founded in 1889 by Horace E. Horton in Chicago, Illinois, USA. While initially involved in bridge design and construction, CB&I turned its focus to bulk liquid storage in the late 19th and early 20th centuries, coinciding with the western expansion of railroads across the United States and the discovery of oil in the Southwest. CB&I quickly became known for design engineering and field construction of elevated water storage tanks, above-ground tanks for storage of petroleum and refined products, refinery process vessels and other steel plate structures. As such, CB&I supported the expansion of oil exploration outside the US, starting operations in South America in 1924, in Asia two years later and in the Middle East in 1939.

According to one of the founder's heirs, "The old joke is that Chicago Bridge & Iron isn't in Chicago, doesn't build bridges and doesn't use iron."[4]

During World War II, CB&I was selected to build Landing Ship Tanks (LSTs), which carried troops and supplies to American and Allied troops fighting in Europe and the Pacific theater. CB&I was chosen because of their reputation and skills, particularly welding. Since the coastal shipyards were busy building large vessels for the war effort, such as aircraft carriers, battleships, cruisers and destroyers, there was no alternative but to use the inland waterways and shipyards for the production of smaller ships. As a result of these and other wartime production activities, CB&I ranked 92nd among US corporations in the value of World War II military production contracts.[8]

CB&I has been involved in a number of changes during the past two decades. It was acquired by Praxair in 1996; Praxair kept a chemical subsidiary and spun off CB&I as a Dutch-incorporated company the next year.[4] CB&I headquarters moved from Chicago to Houston, Texas in 2001 and then to the Hague, Netherlands when Texas enacted a franchise tax.

Since 2000, it has acquired a number of companies. In 2012, CB&I agreed to buy The Shaw Group for about US$3 billion,[9][10][11] completing the acquisition in February 2013.[12]

The subsidiary that was formed as a result, CB&I Stone Webster—a result of The Shaw Group's earlier acquisition of Stone & Webster during its bankruptcy—was again sold, in January 2016, to Westinghouse Electric Co., for US$ 229M.[13]

In May 2018 the company merged into McDermott International.[14]

Corporate headquarters and leadership

Corporate headquarters were located in The Hague, Netherlands. The administrative headquarters were located in The Woodlands, Texas.[15] In 2018 McDermott announced that it would sell the headquarters facility in The Woodlands to Howard Hughes Corporation.[16]

Historic structures

The company built bridges and other works of historic importance, including some listed on the National Register of Historic Places.[17] These works include (with varying attribution):

CB&I, 2000-present

In late 2000, CB&I embarked on a series of acquisitions that have expanded its services to encompass the entire hydrocarbon industry, from conceptual design through technology licensing, engineering and construction, to final commissioning and technical services. CB&I acquired Lummus Global from ABB on November 19, 2007, adding approximately 3,000 employees to the CB&I payroll.[33][34] CB&I announced the acquisition of The Shaw Group in 2012, which added pipe, steel and module fabrication solutions as well as engineering and construction capabilities in the power generation industry that included fossil and nuclear construction. The transaction was completed on February 13, 2013.Company Press Release In 2015, CB&I announced that they are selling their Nuclear Construction division to Westinghouse Electric Company, a subsidiary of Toshiba, for $229 million.[35] For 2017, revenue for CBI was $6.7 billion, down from the year before.[1]

As of July 2017, CB&I's global business groups were:

  • Technology, which offers licensed process technologies, catalysts, specialized equipment and engineered products for use in petrochemical facilities, oil refineries and gas processing plants;
  • Engineering & Construction, which provides engineering, procurement, fabrication and construction of major energy infrastructure facilities;
  • Fabrication Services, which offers fabrication capabilities for piping, structural steel, module prefabrication and assembly, as well as storage tanks and vessels for the oil and gas, water and wastewater, mining and power generation industries

After being acquired by McDermott, CB&I's stock ceased being listed on the NYSE on May 11, 2018. Gary P. Luquette was the chairman of the combined company.[36]

Recent major projects

Examples of recent major projects around the world include:

  • Natural gas processing and treating complex in Cabinda Province, Angola;
  • Crude vacuum and decoking unit expansion project for a refinery in Kansas, US;
  • Golden Pass LNG import terminal near Sabine Pass, Texas, US;
  • Large tankage facility at Shell Pearl GTL, Qatar;
  • Hydrotreating and sulfur removal/recovery facilities for several major US refiners;
  • LNG re-gasification terminal at Quintero Bay, Chile;[38]
  • Cat gas hydrotreater (CGHT) in El Paso, Texas, US;
  • Hydrogen generation plant in Benecia, California, US;
  • Propane dehydrogenation unit in Houston, Texas, US;
  • Multiple Middle East storage facilities; and
  • Oil sands storage tanks in Alberta, Canada.

In November 2004, CB&I was awarded a contract by one of the world's largest suppliers of wind turbines to fabricate 150 tubular steel support towers for wind turbines that were installed in wind farms in the western United States. The towers support 1.5-megawatt wind turbines, which are the largest wind turbines assembled in the United States and the most widely sold and tested megawatt-class wind turbines in the world. In April 2012, CB&I was awarded a contract for a petrochemicals expansion project in Geismar, Louisiana, including the license and basic engineering for the ethylene technology.[39]

In 2012, CB&I Technology (formerly Lummus Technology) was awarded a contract by Indian Petrochemicals major,[40] Reliance Industries to design to provide paraxylene (PX) technology for an aromatics complex in India. The complex is one of the largest of its kind, has capacity to make 2.2 MMTPA of Paraxylene. The complex was started up in April 2017.[41] With the start-up of this complex, Reliance is now the 2nd largest world producer of Paraxylene.[41]

Controversy

CB&I was revealed as a subscriber to the UK's Consulting Association, exposed in 2009 for operating an illegal construction industry blacklist; CB&I was one of 14 companies issued with enforcement notices by the UK Information Commissioner's Office.[42] A CB&I employee consulted the blacklist more than 900 times in 2007 alone, a 2010 employment tribunal was told.[43]

References

  1. 1 2 3 https://www.prnewswire.com/news-releases/cbi-reports-fourth-quarter-and-full-year-2017-financial-results-300601349.html
  2. 1 2 3 4 5 "Chicago Bridge Iron, Form 10-K, Annual Report". secdatabase.com. Retrieved June 9, 2016.
  3. ↑ "Chicago Bridge Iron, Who We Are". Retrieved Jun 7, 2017.
  4. 1 2 3 Young, David (6 March 1997). "Chicago Bridge & Iron Set For Spinoff". Chicago Tribune. Retrieved 15 February 2017.
  5. ↑ "Veritas Capital Acquires Capital Services Business from CB&I for $755 Million". www.businesswire.com. Retrieved 2017-04-11.
  6. ↑ "McDermott Inks $6B Merger Deal With Chicago Bridge & Iron". December 19, 2017.
  7. ↑ "McDermott and CB&I Stockholders Approve Proposed Combination". McDermott International. 2018-05-02. Retrieved 2018-05-15.
  8. ↑ Peck, Merton J.; Scherer, Frederic M. (1962). The Weapons Acquisition Process: An Economic Analysis. Cambridge, MA: Division of Research, Graduate School of Business Administration, Harvard University. p. 619, of 736 pp. Retrieved 15 February 2017.
  9. ↑ Polson, Jim & Black, Thomas (30 July 2012). "CB&I to Buy Shaw Group for $3 Billion to Add Nuclear Unit". Bloomberg News. Retrieved 30 July 2012 – via SFGate.com.
  10. ↑ CB&I Staff (30 July 2012). "Current Report, Chicago Bridge & Iron Company N.V., The Netherlands". Form 8-K. Washington, DC: United States Securities and Exchange Commission. Retrieved 15 February 2017 – via secdatabase.com.
  11. ↑ Chaudhuri, Saabira (30 July 2012). "Shaw Group Agrees to CB&I's $3.04B Takeover Bid". MarketWatch.com. Retrieved 15 February 2017.
  12. ↑ Zacks (14 February 2013). "CBI Completes Shaw Acquisition". Yahoo Finance. Chicago, IL: Zacks Equity Research. Retrieved 15 February 2017 – via Finance.Yahoo.com.
  13. ↑ Downey, John (January 6, 2016). "CB&I Completes Sale of Nuclear Subsidiary". Charlotte Business Journal. Charlotte, NC: American City Business Journals. Retrieved February 15, 2017.
  14. ↑ "McDermott and CB&I Stockholders Approve Proposed Combination". McDermott International. 2018-05-02. Retrieved 2018-05-15.
  15. ↑ CB&I Staff (15 February 2017). "Where We Work—Corporate Offices". CBI.com. Retrieved 15 February 2017.
  16. ↑ Mann, Joshua (2018-09-06). "McDermott to sell former CB&I HQ in The Woodlands to Howard Hughes". Houston Business Journal. Retrieved 2018-09-11.
  17. ↑ "Search for Chicago Bridge & Iron Company". www.nps.gov. National Park Service. Retrieved 2017-05-19.
  18. ↑ "Asset Detail". Npgallery.nps.gov. 2007-11-14. Retrieved 2017-07-22.
  19. ↑ "Asset Detail". Npgallery.nps.gov. 1993-02-09. Retrieved 2017-07-22.
  20. ↑ "Asset Detail". Npgallery.nps.gov. 1998-05-20. Retrieved 2017-07-22.
  21. ↑ "Asset Detail". Npgallery.nps.gov. 2008-02-27. Retrieved 2017-07-22.
  22. ↑ "Asset Detail". Npgallery.nps.gov. 2008-01-24. Retrieved 2017-07-22.
  23. ↑ "Asset Detail". Npgallery.nps.gov. 2001-09-16. Retrieved 2017-07-22.
  24. ↑ "Asset Detail". Npgallery.nps.gov. 1997-11-24. Retrieved 2017-07-22.
  25. ↑ Allan Eich; Leah D. Rogers. "Manning Water Tower" (PDF). National Park Service. Retrieved 2017-11-14.
  26. ↑ "Asset Detail". Npgallery.nps.gov. 2007-09-20. Retrieved 2017-07-22.
  27. ↑ "Asset Detail". Npgallery.nps.gov. 1998-06-25. Retrieved 2017-07-22.
  28. ↑ "Asset Detail". Npgallery.nps.gov. 2008-01-24. Retrieved 2017-07-22.
  29. ↑ "Asset Detail". Npgallery.nps.gov. 1998-05-15. Retrieved 2017-07-22.
  30. ↑ "Asset Detail". Npgallery.nps.gov. 2007-09-20. Retrieved 2017-07-22.
  31. ↑ "Asset Detail". Npgallery.nps.gov. 1985-03-21. Retrieved 2017-07-22.
  32. ↑ "Asset Detail". Npgallery.nps.gov. 2003-02-05. Retrieved 2017-07-22.
  33. ↑ CB&I Staff (30 August 2007). "Current Report, Chicago Bridge & Iron Company N.V., The Netherlands". Form 8-K. Washington, DC: United States Securities and Exchange Commission. Retrieved 25 March 2013 – via secdatabase.com.
  34. ↑ CB&I Staff (21 November 2007). "Current Report, Chicago Bridge & Iron Company N.V., The Netherlands" (PDF). Form 8-K. Washington, DC: United States Securities and Exchange Commission. Retrieved 25 March 2013 – via secdatabase.com.
  35. ↑ Smith, Rebecca (2015-10-29). "Westinghouse Buys CB&I Division to Beef Up Its Nuclear Business". Wall Street Journal. ISSN 0099-9660. Retrieved 2016-10-19.
  36. ↑ http://www.mcdermott-investors.com/news/press-release-details/2018/McDermott-Completes-Combination-with-CBI/default.aspx
  37. ↑ "Peru LNG Inaugurates $3.8B Liquefaction Plant". Peru LNG. Downstream Today. 2010-06-10. Retrieved 2010-06-12.
  38. ↑ This is an approximately $775 million project.
  39. ↑ "CB&I announces Petrochemicals Expansion Project in the U.S." industrial-newsroom.com. Retrieved 15 February 2017.
  40. ↑
  41. 1 2 India, Press Trust of (2017-04-20). "RIL commissions final phase of Jamnagar paraxylene project". Business Standard India. Retrieved 2017-06-07.
  42. ↑ "Construction blacklist". ICO.org. ICO. Retrieved 7 September 2015.
  43. ↑ Boffey, Daniel (2 December 2012). "Crossrail Project Dragged Into Blacklist Scandal". The Guardian. Retrieved 5 May 2013.
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