BE&K, Inc. is an international engineering firm, now a division of the Services Business Unit of Houston, Texas-based KBR Inc. It was founded in Birmingham in 1972 by former Rust Engineering employees Peter Bolvig, Bill Edmonds and Ted C. Kennedy. For most of its history it was owned by a group including the families of its founders and 100 employees. In 2001 it became the largest private company in the Birmingham area and is one of the 250 largest privately-held companies in the United States, according to Forbes 2003 rankings. It was sold to KBR in May 2009 for $550 million with a promise that it would remain intact as a wholly-owned subsidiary headquartered in Birmingham.
BE&K is the 48th largest general contractor in the United States. It designs, builds and maintains industrial facilities and sports stadiums in addition to providing engineering services to other firms. The company has 9,000 employees in officies and divisions across the United States, Europe, Asia, South America and Australia. Revenues for the year ending in March 2008 were approximately $2 billion. The last BE&K CEO was Mike Goodrich. The division is currently headed by David Zimmerman out of Houston. BE&K's local headquarters are in International Park at I-459 and Acton Road.
BE&K was founded on April 1, 1972 by Peter Bolvig, Bill Edmonds and Ted C. Kennedy, all formerly of Rust Engineering, as managers. "Silent partner" Henry Goodrich joined Caldwell Marks and William Spencer III of Motion Industries as investors. The new company was based largely on the professional style of Rust prior to its acquisition by Litton Industries in 1967. Edmonds was the first CEO and president. Kennedy was vice-president and treasurer and Bolvig was vice-president and secretary. Barbara Handley, later nicknamed "the ampersand in BE&K", joined as secretary.
The company opened an office on the second floor of a warehouse at 3200 6th Avenue North downtown. Within a couple of months they were ready to move to a larger space at 1900 28th Avenue South in Homewood. Its first major clients were pulp and paper mills. Through the 1970s they made a name for themselves by installing major paper processing equipment efficently for a variety of clients across the south. Working as a merit shop, they found a need to create a union subsidiary, Redrock Construction to compete for jobs where union contracts were required.
BE&K's principals and merit-shop organization allowed the start-up company to partner with Ford, Bacon and Davis in Monroe, Louisiana on an expansion project for South Carolina Industries. With this project in hand, BE&K assembled its construction capacity. By completing the project under budget and ahead of schedule, they earned a reputation for quality, which brought more work. They constructed a liquefied natural gas facility for Southern Natural Gas in Elba Island, Georgia, pushing them to #285 on the Engineering News Record's Top 400 Construction Firms in their first year.
BE&K quickly established itself as a premier merit-shop contractor in the Southeast. The company completed a machine mill for Virginia Fibre in 1975 and established itself as an innovator in pulp and paper mill operations with a series of successes. In 1976 the company built the world's largest recycled newsprint mill for Southeast Paper Manufacturing in Dublin, Georgia, generating favorable press for cutting the cost and construction time. Satisfied that they could continue solely with their merit-shop model, Redrock Construction was shut down in 1978. The company moved to new headquarters in Inverness in 1982. BE&K opened an industrial maintenance division.
Diversification efforts led to a partnership with Finland's Jaakkro Pöyry Group, which brought in a pioneering computer-aided design (CAD) system. They also acquired Brazos Construction of Houston, Texas and Danco Construction of Lynn Haven, Florida, transforming it into a plant-shutdown specialist. BE&K entered the real estate development business with another Finnish partner, Polar Construction. In 1987 BE&K built a new headquarters at International Park.
During the late 1980s these efforts paid off and revenues climbed from $650 million in 1986 to $1.3 billion in 1988. In 1989 BE&K's reputation as a non-union contractor became controversial. Union leaders alleged that BE&K's construction arm was marketing itself as a "union buster". BE&K was brought in to replace striking workers at an International Paper plan in Maine in 1987. Also that year, union organizers caused significant delays to a BE&K project to construct a USS-POSCO steel mill in Pittsburg, California. BE&K sued the unions for unfair labor practices and the next decade brought innumerable filings and court actions which restricted BE&K's growth. The construction of a $535 million paper mill expansion in International Falls, Minnesota was threatened by wildcat strikes and a riot that caused damage to a camp BE&K had set up for out-of-state workers. Kennedy, who had also become president of the open-shop organization Associated Builders and Contractors, found himself at the focus of labor activism.
In 1992, Kennedy stunned an audience of contractors with a call to significantly upgrade worker compensation and benefits. Over the next several years he led a series of improvements that resulted in BE&K's recognition as a model employer. He said that "over the years, [I've] learned that you have to have faith that investing in people yields better work." Revenue reached a peak in 2000 at $1.8 billion.
Goodrich and Kennedy retired from BE&K effective December 31, 2008. Their retirements left the subsidiary without a Birmingham-based chairman. It is managed under KBR's Business Services Unit headquartered in Houston, Texas.
BE&K heads a family of companies providing specialized services:
- Allstates Technical Services, Inc. - outsourcing, staffing and employment management for engineering and IT.
- As-Built Services - surveying, photography, structural analysis, CAD modeling, photogrammetrt and laser scanning
- BE&K Building Group - commercial, healthcare, industrial and institutional construction services
- MEI Consultants, Inc. - engineering services to the hydrocarbon and petrochemical industries (Acquired in 2000, headquartered in Houston, Texas)
- NorthStar Communications Group, Inc. - wireline and wireless telecommunications and enterprise services - sold in June 2008 to AFL Network Services of Spartanburg, South Carolina
- QBEK - quality assurance services
- Rintekno Group - industrial and service facility design and construction. (Headquartered in Espoo, Finland)
- BE&K's Saginaw Warehouse - small tools, consumables and equipment for construction
- SW&B Construction - heavy industrial contracting specializing in pulp & paper mills. (Offices in Auburn, Maine and Daphne, Alabama)
- Terranext, LLC - environmental consulting and engineering (Acquired in 1997, headquartered in Denver, Colorado)
- Suitt Construction - construction and design-build services. (Headquartered in Greenville, South Carolina)
- F. N. Thompson Company - general contracting, purchased in 1979 (Headquartered in Charlotte, North Carolina)
- BE&K website
- Stanton, Al, et al. (1997) BE&K: The First 25 Years: A Work in Progress. Birminigham: BE&K.
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- Bearden, Sandra. (Spring 2005) "Success by Design: Innovative Minds Build Solid Infrastructure." Venture. UAB School of Business. Vol. 8, No. 1.
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- Shellenbarger, Sue, (December 26, 2001) "A Long Career Gives Business Leader Lesson in How to Value Labor". Wall Street Journal
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- Williams, Roy L. (May 18, 2008) "For Birmingham, this means." interview with Ted C. Kennedy. Birmingham News
- Cooper, Lauren B. (January 23, 2009) "BE&K pioneers retire, say firm 'in good hands'." Birmingham Business Journal