Posted: Jul 30, 2012 6:28 PM by Michael Shingleton
Updated: Jul 30, 2012 6:28 PM
BATON ROUGE - The Shaw Group President, Chairman and CEO Jim Bernhard said "not all change is bad" after the company he started sold for $3.04 billion to Texas-based CB&I, formerly known as Chicago Bridge and Iron Co.
Investors gained more than a 55 percent return from Friday when Shaw stock was trading at $26.69 a share. With Shaw stock now hovering at $41.49, Bernhard said the merger with CB&I is one of the largest in history.
"CB&I's plan is to have Shaw as one of their subsidiaries. They have three others," Bernhard told News 2 in an exclusive interview. "Shaw is going to be a subsidiary as well. It'll be right here in the building on Essen Lane. It'll be called 'CBI Shaw.' They'll add three letters to the name, and for most people in Baton Rouge, they won't notice the difference too much."
Bernhard does not foresee any significant negative changes to personnel and said the merger may create jobs.
"I think our engineering group will double in size, I think our modular facility will add 200-300 people. I think the overall employment here in Louisiana will go up, not down," Bernhard said.
Of the 27,000 employees worldwide and the roughly 1,000 in Baton Rouge, Bernhard thinks only 15 to 20 are out immediately.
"I'm not going to be here anymore. I'm retired, so we're talking about two to three of the top executives, and [CB&I] will have some new executives take our places to manage it like they want to," Bernhard said.
He hopes CB&I would hire from within, but there are no guarantees. There are also no guarantees Shaw operations will continue to be based in Baton Rouge many years down the line. But Bernhard said Shaw's name recognition and prior partnerships in Louisiana could mean the merger may create dozens of CB&I business opportunities in the future.
"There's more than $40 billion scheduled for Louisiana. Now with Shaw's workforce, with Shaw's fabrication, with Shaw's engineering, combined with CB&I's technology, it makes CB&I Shaw the likely choice to do the work at home," Bernhard said.
He described the loss of Baton Rouge's only Fortune 500 company as a "sad part of the story," but said CB&I will provide better jobs and more opportunities for Shaw's employees.
"They'll be part of the major division of an even larger Fortune 500 company and we're very proud of that," Bernhard said.
The Shaw Group started as a small piping operation 25 years ago. Since then, it's grown into one of three Fortune 500 companies in the state with annual profits of nearly $6 billion.