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If you like Dennis Washington's story, you might also like:
Tenley Albright,
Francis Ford Coppola,
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Quincy Jones,
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Sanford Weill

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The Washington Companies
Dennis & Phyllis Washington Foundation

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Dennis Washington
 
Dennis Washington
Profile of Dennis Washington Biography of Dennis Washington Interview with Dennis Washington Dennis Washington Photo Gallery

Dennis Washington Biography

Construction, Mining and Railroads

Dennis Washington Date of birth: July 27, 1934

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  Dennis Washington

Dennis Washington Biography Photo
Dennis Washington was born in Spokane, Washington. When he was still very young, his parents moved to his mother's hometown of Missoula, Montana. With America's entry into World War II, the family moved again, to Bremerton, Washington, where his father found work in the shipyards and the family in government-supplied housing. Young Dennis earned extra money shining shoes outside the shipyard with his friend Quincy Jones. At age eight, Dennis contracted polio and spent most of the following year in a hospital in Seattle.

After the war ended, and work in the shipyards slowed, his parents separated, and young Dennis moved from the home of one relative to another, in California, Washington and Montana. His favorite home was that of his grandmother in Missoula. Although his illness and frequent moves caused him to fall behind in school, Dennis Washington had no fear of hard work, and took on a variety of jobs to become self-sufficient. He worked in gas stations after school and spent summers greasing machinery, while learning to run bulldozers, cranes and backhoes. At 19, he traveled to Alaska, where he earned a reputation as an outstanding heavy equipment operator.

Dennis Washington Biography Photo
Washington returned to Montana, to visit the grandmother who had provided him with his most stable home, and went to work for the construction firm King-McLaughlin, owned by his maternal uncle, Hugh (Bud) King. At 23, he was running the largest highway construction project Montana had ever seen. The same year, he worked as a subcontractor on the Noxon Rapids Dam. The main contractor was the national construction firm, Morrison Knudsen. Almost 20 years later, Washington would cross paths with the company again, under very different circumstances.

At 26, Washington was a vice president of King McLaughlin, supervising construction projects all over Montana. In 1967, at age 29, he resolved to go into business for himself. He borrowed $30,000 from a local Caterpillar dealer to lease a bulldozer and start his own construction company. Too small at first to bid on federal highway projects, he found a niche in forestry work, starting with a new road through Glacier National Park.

Dennis Washington Biography Photo
By the age of 34, Washington was the largest contractor in Montana. Still, he was often forced to put up his own home as security to the bonding company underwriting his projects. A single catastrophe could have wiped him out, but he continued to expand. As highway construction slowed in the late 1960s, Washington Corp. branched out into mining and dam building.

In 1986, Washington bought the Anaconda Company from ARCO for roughly $18 million, and reopened its idle copper mines. Washington also acquired the Butte Water Co., which serves both the city and the mines. Washington ran the mines day in, day out, with 325 non-union workers producing as much copper as 600 employees represented by 13 different unions had done under ARCO's ownership. Within three years, the price of copper doubled, and Washington had made $100 million on his initial investment. Within a year of the Anaconda purchase, Washington bought Burlington Northern's southern Montana rail system for roughly $160 million and renamed it Montana Rail Link. With 1,000 miles of mountain track, it is the largest privately held rail line in the United States. Within a few years, the railroad would earn $54 million pretax on revenues of $188 million. Washington reduced the number of union contracts from 14 to two. With costs down, he began to draw business away from truckers, winning the business of lumber companies which hadn't used the rails in 30 years. Montana Rail Link's profit margin is among the highest in the railroad business.

Dennis Washington Biography Photo
Washington also reopened Burlington's long-dormant locomotive repair facility, creating 100 jobs for Washington's new Livingston Rebuild Center, rehabilitating locomotives and railroad cars from all over the country. His Equipco Corp. reconditions used construction equipment for resale, while his Modern Machinery subsidiary resells the equipment all over the world. Another subsidiary, Envirocon specializes in environmental cleanup, long a profitable sideline of his construction company.

His construction interests surged ahead, with projects such as the Senac dam in Aurora, Colorado, and running mining operations for others, including Bullfrog gold mine in Nevada. By this time, Washington could afford to enjoy his hard-won prosperity. He bought a 65,000-acre property in Oregon that had been previously owned by the Indian guru Bhagwan Shree Rajneesh, adding it to the 55,000 acres of his personal spread in Montana. The same year, 1991, Forbes magazine estimated Dennis Washington's personal worth at over half a billion dollars.

Dennis Washington Biography Photo
In 1992, Washington tried to take his Washington Contractors Group public but could not find underwriters to take up the $59 million offering. The same year he bought C.H. Cates & Sons tugboat company, acquiring a near-monopoly on towing in the Port of Vancouver. He also acquired Canada's largest tug and barge company, Seaspan International, and the ocean shipping company Norsk Pacific Steamship. In late 1993, Washington merged his construction firm with the publicly held Kasler Corp.

By 1996, Anaconda's pre-tax earnings were over $85 million, and the Washington Contractors Group had revenues of $230 million and back orders of $400 million. Outside its home base in the Rockies, Washington Contractors Group led the pack in California, building more major roads and bridges than any other contractor.

Still, his revenues were barely a fifth those of the faltering construction giant Morrison Knudsen. Washington, who had once worked for the company as a 23 year-old subcontractor, planned to acquire the historic company, which had built such high-profile projects as the Hoover Dam and the space shuttle hangar at Cape Canaveral. On the day the planned merger was announced, shares in Washington Construction rose from 8.25 to 11 dollars a share. Knudsen's debt securities also rose dramatically as a result of the announcement. Washington's stake in the combined company was valued at $480 million. In a bold move, Washington committed the company to negotiating fixed-cost contracts, rather than cost-plus contracts, betting on his proven ability to guess what a job will cost, and stick to his estimate. The price of shares in the combined companies, the Washington Group International (WGI), virtually doubled in the first year after the merger.

Dennis Washington Biography Photo
The addition of Morrison Knudsen to his empire positioned Washington to compete with the undisputed titans of the construction field, Fluor Corp., Bechtel and the privately held Peter Kiewit Sons'. Along with Kiewit, Washington won contracts to overhaul Salt Lake City's highway system in preparation for the 2002 Winter Olympics.

In 2001, Washington made the fateful decision to buy and merge the construction unit of the Massachusetts-based Raytheon Company. Within months of the purchase, Washington discovered that the company's assets were less valuable, and its liabilities greater, than he had been led to believe, and Washington Group International filed for bankruptcy reorganization. Only the construction businesses owned by the publicly traded WGI were affected. Dennis Washington retained control of his other interests through the privately held Washington Companies.

The reorganized Washington Group International was sold to URS Corporation for $3.1 billion in 2007. Dennis Washington retained control of the privately held Washington Companies with its vast holdings in mining, shipping, shipbuilding, and environmental remediation, as well as the Montana Link railroad and heavy equipment dealerships in the U.S. and Russia. In 2013, Forbes magazine estimated Washington's net worth at $5.8 billion.

Dennis Washington and his wife, Phyllis, divide their time between homes in British Columbia; Palm Desert, California; and Missoula, Montana, where the Washington Companies have their home office. Renovating pleasure boats in his Vancouver shipyard is one of his favorite pastimes. His five-story, 332-foot yacht, the Altessa IV, is one of the world's largest.

Dennis Washington Biography Photo
Dennis Washington's generosity to educational institutions is well known in his home state. The football stadium at the University of Montana is named for Dennis Washington, in recognition of his contributions to the University. He created the Horatio Alger Montana Undergraduate Scholarship program, which provides financial assistance to college students who have faced exceptional adversity. He donated $25 million to endow the Dennis R. Washington Achievement Scholarship to help outstanding undergraduates pursue graduate degrees. Dennis and Phyllis Washington gave their 65,000-acre ranch in Oregon to serve as a summer camp, and have since spent $60 million improving the facilities. The camp serves over 1,000 young people every week. The Dennis & Phyllis Washington Foundation, founded in 1998, has donated more than $130 million to charitable causes.




This page last revised on Nov 07, 2013 12:46 EDT
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