Bruce Wilkinson: Company Savior

McDermott turnaround succeeds against all odds

Bruce Wilkinson already had retired twice from CEO jobs when he was called in 2000 to become chief of Houston’s McDermott International as it tried desperately to save company subsidiary Babcock & Wilcox. For the former chief of once-prominent engineer CRS Sirrine, it was the beginning of one of the most difficult and amazing turnarounds in the industry.

B&W already faced hundreds of thousands of asbestos lawsuits from decades of power and industrial construction. The firm  was in Chapter 11 bankruptcy as Wilkinson, along with CFO Frank Kalman and General Counsel John Nesser, struggled to right the ship. If matters weren’t tough enough, a new disaster struck in 2002. Engineering problems and weather damage on a first-of-a-kind $1-billion offshore platform project in the Gulf of Mexico, performed fixed-price, caused more than $200 million in losses that nearly took down another major subsidiary, J. Ray McDermott. “We were one paycheck away from bankruptcy,” Wilkinson says.

Multimedia  View Award of Excellence Luncheon and Acceptance Speech of Bruce W. Wilkinson  April 3, 2008

The new CEO worked tirelessly for seven years, replacing complacent managers with determined leaders, selling off noncritical assets and instilling a new sense of corporate financial discipline. Wilkinson’s leadership and tenacity enabled B&W to bounce back from the brink, effectively repurchased from the  asbestos litigation trust, and J. Ray McDermott is thriving.

Today, McDermott International has more than 27,000 global employees and its stock has risen in market capitalization from less than $500 million in 2002 to more than $13 billion. Sales and backlog are also at record levels. “The first five-and-a-half years were pretty miserable, but the past 18 months have been pretty rosy,” says Wilkinson.