The Washington Companies - A History of Growth

The 1960's
Washington and his people have always been up to a challenge. A difficult early contract constructing the parking lot at Logan Pass in Glacier National Park was a prelude to future work where success on tough jobs became a hallmark. In the summer of 1964, Washington also contracted to repair flood-damaged roads for the U.S. Forest Service and was soon engaged to build more logging roads. The jobs were demanding, but the new Washington company grew quickly. More small earth-moving jobs led to major highway projects, including building sections of Interstates 15 and 90 in the late 1960s and early 1970s.

The 1970's
In 1972, Washington Construction secured a large phosphate-mining contract near Soda Springs, Idaho. Contract mining became the core business of Conda Mining, and powered the expansion of the companies during the 1970s. Industrial Constructors was soon formed as an offshoot of this mining activity to construct industrial plants. At the same time, Washington Construction continued to grow as a result of successful bids for federal, state, and local highway construction projects.

The jobs were scattered geographically and it became clear that Washington needed to be able to move heavy equipment quickly and economically. Another step in diversification on a theme, Western Transport Crane and Rigging (later Westran) was acquired in 1973. Also in 1973, Equipco was formed as a regional equipment repair center, first providing services primarily to Washington Construction.

In 1976 Washington acquired Modern Machinery Co. Initially a Spokane, Washington International Harvester dealership, Modern sold heavy equipment, parts, and service to the construction, mining, and logging industries. Additional dealerships were added expanding through a four-state territory and internationally, representing Komatsu and numerous other major equipment lines.

As the business interests of Mr. Washington diversified, a structure was created to insure that each individual corporation had a strong president, independent decision making, and corporate financial control and responsibility. Each Company has a board of directors that consists of people knowledgeable in the particular industry who believe in cost-effective options and conservative management. Each Company operates on an individual basis but is able to call upon the collective companies for resources and expertise. To make centralized administrative, data processing, legal, tax, real estate expertise, internal audit, and business development assistance available to other Washington Companies, a business services company, Washington Corporations, was formed in 1979.

The 1980's
In the early 1980s, high production costs and soft commodity prices forced many copper mines to close. Among them was the former Anaconda Company operation in Butte, Montana, owned by Atlantic Richfield. In 1985, a Washington Company, Montana Resources, Inc., acquired ARCO's mining operations in Montana. Some experts thought it would be impossible to reopen the mine. Mr. Washington knew they had to cut costs and improve productivity to be profitable. Although the former mine operation had required three times as many employees, MRI announced that only about 360 workers could be hired. Many former miners applied for the jobs and in August 1986, MRI reopened the mine and began producing copper and molybdenum concentrates. Soon, efficient operation and significant improvement in copper prices rewarded both Washington's risk and employee's efforts. The mine acquisition was to eventually provide a financial platform for other ventures.

Growth also created opportunities for consolidation. In 1987, Washington Construction, Industrial Constructors, and Conda Mining were merged to form Washington Contractors Group, Inc., (WCGI). Later, Pro Builders was established to pursue structural building opportunities.

Also in 1987, the Washington Companies' diversification continued with the purchase of Burlington Northern Railroad's southern Montana route, extending from Huntley, Montana, to Sandpoint, Idaho. The line, operated as Montana Rail Link, provides vital east-west freight transportation across Montana. MRL is the largest privately held railroad in the United States and the nation's thirteenth largest railroad overall.

To serve the nation's growing interest in environmental clean-up, Envirocon, Inc. was created in 1988. Washington realized that environmental remediation lent itself to the equipment and construction skills that already were available within the organization. Envirocon carries out private and public-sector civil construction, remediation and industrial waste management contracts throughout the United States.

As a means of sharing this overall success, and to manage corporate giving for a coordinated and effective philanthropic effort, the Dennis and Phyllis Washington Foundation was also founded in 1988. The Foundation has contributed millions of dollars to various charities. The Foundation is funded from the pre-tax profits of various Washington companies and generous personal donations of the Washingtons.

Equipment rebuilding expanded further in 1989 when Washington acquired Tacoma-based Coast Engine & Equipment Company (CEECO). Coast Engine specializes in rebuilding powerplants and components for the rail and marine transportation industries.

The 1990's
1992 brought international scope to the group of companies. Washington expanded into the maritime transportation market with the purchase of the Canadian tugboat company, C.H. Cates and Sons. Southern Railway of British Columbia, a shortline serving the Vancouver and Fraser Valley area since 1887, was acquired two years later adding another link to the Washington Rail Link group.

In 1993, Washington Contractors Group, Inc., merged with Kasler Corporation of California. Kasler was a well-established company specializing in highway and bridge construction, with revenues comparable to WCGI's. From this union evolved Washington Construction Group, Inc., one of the strongest and most versatile contractors in the western United States.

Another maritime transportation acquisition occurred in 1994 with a partial purchase of Seaspan International Ltd., the largest tug and barge company in Canada. Seaspan transports forest products, petroleum, chemical and mineral products in vital service to coastal industries, ranging the entire west coast of North America. Seaspan brought with it important shipyard and drydock companies engaged in shipbuilding, maintenance and repair. This company quickly became an integral component of Washington's venture into the world of international transportation. Seaspan became wholly owned in 1996.

Further expansion in international maritime transportation came in June 1995 with the acquisition of Norsk Pacific Steamship Company. Norsk provides shipping for paper products between British Columbia and California. Together these companies provided important links in Washington's transportation strategy.

Around this time, reflecting interest generated by business travel needs, Aviation Partners, Inc. was formed to pursue development and marketing of aerodynamic winglets for high-performance business aircraft. Aviation Partners Boeing is a joint venture formed in 2001 pursuing winglet application to large commercial jets.

In 1996, Washington Construction Group, Inc. acquired a major interest in publicly traded Morrison Knudsen Corporation. Merging the financially powerful Washington Construction Group with MK revitalized this historic and respected company. In 1998, MK acquired Westinghouse engineering and construction operations. In 2000 MK also acquired Raytheon Engineers & Constructors. Recognizing the synthesis of what had essentially become a new company and a major force in the industry, MK changed its name to Washington Group International, Inc.

Another railroad acquisition took place in April 1997 when a portion of the old Soo Line was purchased and named I & M Rail Link serving 1,385 miles in the Midwest. IMRL was sold in November 2002.

In October 1997, Kingcome Navigation was brought into the Washington Marine Group. Kingcome was a Vancouver, B.C., based log barging and towing company A year later, in 1998, Canadian Pacific Railway divested its Coastal Marine Operations, provider of commercial truck and ferry service to Vancouver Island. This operation, also a logical fit into the Washington transportation endeavor, was acquired and renamed Seaspan Coastal Intermodal Company.

1998 saw formation of the Washington Marine Group of Companies (WMGC), an umbrella organization linking the northwest marine Companies in concert, and the Washington Transportation Group, overseeing interests in common for the railroads, in a move toward beneficial synchronization between companies.