Stone & Webster was an American engineering services company based in

Stoughton, Massachusetts Stoughton (official name: Town of Stoughton) is a town in Norfolk County, Massachusetts, United States. The population was 29,281 at the 2020 census. The town is located approximately from Boston, from Providence, Rhode Island, and from Cape ...

. It was founded as an electrical testing lab and consulting firm by

electrical engineers Electrical engineering is an engineering discipline concerned with the study, design, and application of equipment, devices, and systems which use electricity, electronics, and electromagnetism. It emerged as an identifiable occupation in the l ...

Charles A. Stone and Edwin S. Webster in 1889. In the early 20th century, Stone & Webster was known for operating

streetcar A tram (called a streetcar or trolley in North America) is a rail vehicle that travels on tramway tracks on public urban streets; some include segments on segregated right-of-way. The tramlines or networks operated as public transport are ...

systems in many cities across the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territorie ...

including

Dallas Dallas () is the List of municipalities in Texas, third largest city in Texas and the largest city in the Dallas–Fort Worth metroplex, the List of metropolitan statistical areas, fourth-largest metropolitan area in the United States at 7.5 ...

Houston Houston (; ) is the most populous city in Texas, the most populous city in the Southern United States, the fourth-most populous city in the United States, and the sixth-most populous city in North America, with a population of 2,304,580 in ...

and

Seattle Seattle ( ) is a seaport city on the West Coast of the United States. It is the seat of King County, Washington. With a 2020 population of 737,015, it is the largest city in both the state of Washington and the Pacific Northwest regio ...

. Middleton, William D. (1967). ''The Time of the Trolley'', pp. 122–128. Milwaukee:

Kalmbach Publishing Kalmbach Media (formerly Kalmbach Publishing Co.) is an American publisher of books and magazines, many of them railroad-related, located in Waukesha, Wisconsin. History The company's first publication was ''The Model Railroader'', which be ...

. . The company grew to provide engineering, construction, environmental, and plant operation and maintenance services, and it has long been involved in power generation projects, starting with hydroelectric plants of the late 19th-century; and with most American nuclear power plants. Stone & Webster was acquired and integrated as a division of

The Shaw Group The Shaw Group is a pipe and module fabrication firm specializing in induction bending. Headquartered in Houston, Texas, Shaw employs approximately 700 people across its offices and operations in North America and the Middle East. History Sha ...

in 2000, and in 2012, the French engineering conglomerate

Technip Technip S.A. was a company that carried out project management, engineering and construction for the energy industry; in 2017 it completed a merger with FMC Technologies to form TechnipFMC. Its headquarters were in the 16th arrondissement of Pa ...

acquired Stone & Webster's energy and chemical business, and process technologies and associated oil and gas engineering capabilities from The Shaw Group. The CB&I acquisition of other assets of

, also in 2012, resulted in the formation of a nuclear power subsidiary, CB&I Stone Webster, which operated for about 4 years, being sold in January 2016 to

Westinghouse Electric Company Westinghouse Electric Company LLC is an American nuclear power company formed in 1999 from the nuclear power division of the original Westinghouse Electric Corporation. It offers nuclear products and services to utilities internationally, includi ...

History

Founding through 1930s

Charles A. Stone and Edwin S. Webster first met in 1884 and became close friends while studying electrical engineering at the

Massachusetts Institute of Technology The Massachusetts Institute of Technology (MIT) is a private land-grant research university in Cambridge, Massachusetts. Established in 1861, MIT has played a key role in the development of modern technology and science, and is one of the ...

. In 1890, only two years after graduating, they formed the Massachusetts Electrical Engineering Company. The name was changed to Stone & Webster in 1893. Their company was one of the earliest electrical engineering consulting firms in the United States. Stone & Webster's first major project was the construction of a hydroelectric plant for the New England paper company in 1890. Stone & Webster not only had valuable insight into developing and managing utilities but they also had keen intuition for businesses to invest in. For instance, due to the

panic of 1893 The Panic of 1893 was an economic depression in the United States that began in 1893 and ended in 1897. It deeply affected every sector of the economy, and produced political upheaval that led to the political realignment of 1896 and the pres ...

, Stone & Webster were able to acquire the Nashville Electric Light and Power Co. for a few thousand dollars and later sold it for $500,000. Throughout the next ten years, Stone & Webster acquired interest in large number of utilities while offering managerial, engineering and financial consulting to a number of independent utility firms. Even though Stone & Webster were not a holding company, their financial and managerial presence meant that they had considerable influence in policy decisions. They would often be paid in utility stock. Stone & Webster became involved in Washington State engineering projects—Washington's natural resources, and hydroelectric power, and resulting development opportunities brought companies like Stone & Webster to the state—beginning with Puget Sound area street railways. By 1900, they had controlled and merged eight small rail lines in Seattle; soon after, they also took over the street railway systems of Tacoma and Everett. By 1908, Stone & Webster listed thirty-one railway and lighting companies under its management including five located in Washington State: the Puget Sound Electric Railway, Puget Sound International Railway and Power Co., Puget Sound Power Co., The Seattle Electric Co., and Whatcom County Railway and Light Co. Stone & Webster leadership was sensitive to the concerns of large utility holding companies and were careful to emphasize the complete independence of these utilities, but Edwin Webster believed that outside capital was crucial to develop the resources of Washington, and chided those who thought otherwise. In 1905, Stone & Webster bought out the power and lighting properties that were once owned by the Bellingham Bay Improvement Co., including the York Street Steam plant and the partially built Nooksack Falls Hydroelectric Power Plant.Stone & Webster took over construction operations and on September 21, 1906, Bellingham received power from the plant via a transmission line. Despite the independence allowed its subsidiaries, J.D. Ross, superintendent of Seattle City Light issued a report critical of Stone & Webster's presence in Seattle, listing 49 companies under Stone & Webster's management at the time. By 1912, the company, nationally, had divided itself into three specialized subsidiaries: * Stone & Webster Engineering * Stone & Webster Management Association * Stone & Webster Investments In 1927, Stone & Webster expanded the investments business, merging its securities subsidiaries with the investment banking firm of Blodget & Co. founded in 1886, to form Stone & Webster and Blodget, Inc.

1940s activities, including in nuclear power

Stone & Webster wartime were involved in the

Manhattan Project The Manhattan Project was a research and development undertaking during World War II that produced the first nuclear weapons. It was led by the United States with the support of the United Kingdom and Canada. From 1942 to 1946, the project w ...

, which designed and built the atomic bomb. Stone & Webster was involved in creating the facilities and laboratories for the

. Prior to its acquisition it was also part of the

Maine Yankee Maine Yankee Nuclear Power Plant was a nuclear power plant built at an 820-acre site on Bailey Peninsula of Wiscasset, Maine, in the United States. It operated from 1972 until 1996, when problems at the plant became too expensive to fix. It was ...

decommissioning project. The company was selected in June 1942 by the first MED District Engineer, Colonel

James C. Marshall Brigadier General James Creel Marshall (15 October 1897 – 19 July 1977) was a United States Army Corps of Engineers officer who was initially in charge of the Manhattan Project to build an atomic bomb during World War II. A member of the Ju ...

, as the main subcontractor for the project. In January, 1946, the name of the business, was changed to Stone and Webster Securities Corporation. Stone and Webster Securities was one of the 17 U.S. investment banking and securities firms named in the

United States Department of Justice The United States Department of Justice (DOJ), also known as the Justice Department, is a federal executive department of the United States government tasked with the enforcement of federal law and administration of justice in the United State ...

's antitrust investigation of Wall Street commonly known as the

Investment Bankers Case ''United States v. Morgan'', 118 F. Supp. 621 (S.D.N.Y. 1953), more commonly referred to as the Investment Bankers Case was a multi-year antitrust case brought by the United States Justice Department against seventeen of the most prominent Wall ...

. The Stone & Webster investment banking operations were eventually acquired by

Kidder Peabody Kidder, Peabody & Co. was an American securities firm, established in Massachusetts in 1865. The firm's operations included investment banking, brokerage, and trading. The firm was sold to General Electric in 1986. Following heavy losses, it was ...

which already had overlapping ownership.

1950s and 1960s

Challenges in the 1970s–80s

The investment banking affiliate, Stone & Webster Securities, had attempted to grow by acquiring two smaller, regional brokerage houses in 1968: Hayden, Miller & Co., based in Cleveland, and Atlanta-based Wyatt, Neal & Waggoner. That increased the number of offices of the firm from nine to 28, but cultural and style differences between the parent company's traditional engineering management and retail brokerage management led to an exodus of key employees, and the Securities firm closed its doors in 1974. Stone & Webster headquarters

1990s

2000s

The company collapsed in 2000 after a major

bribery Bribery is the Offer and acceptance, offering, Gift, giving, Offer and acceptance, receiving, or Solicitation, soliciting of any item of value to influence the actions of an official, or other person, in charge of a public or legal duty. With reg ...

scandal. It had attempted to pay $147 million to a relative of

Indonesia Indonesia, officially the Republic of Indonesia, is a country in Southeast Asia and Oceania between the Indian and Pacific oceans. It consists of over 17,000 islands, including Sumatra, Java, Sulawesi, and parts of Borneo and New Guine ...

n President

Suharto Suharto (; ; 8 June 1921 – 27 January 2008) was an Indonesian army officer and politician, who served as the second and the longest serving president of Indonesia. Widely regarded as a military dictator by international observers, Suharto ...

to secure the largest contract in Stone & Webster's history. But the plan went bad, and the company fell along with it. Subsequently, Stone & Webster filed for

Chapter 11 bankruptcy protection Chapter 11 of the United States Bankruptcy Code (Title 11 of the United States Code) permits reorganization under the bankruptcy laws of the United States. Such reorganization, known as Chapter 11 bankruptcy, is available to every business, wheth ...

in 2000 because of cash flow problems. It was bought at auction by the

Shaw Group The Shaw Group is a pipe and module fabrication firm specializing in induction bending. Headquartered in Houston, Texas, Shaw employs approximately 700 people across its offices and operations in North America and the Middle East. History Sha ...

for US$150 million. The Shaw Energy and Chemicals division integrated Stone & Webster branded technology. Shaw's E&C division attempted to compete with other more successful engineering contractors such as

Bechtel Bechtel Corporation () is an American engineering, procurement, construction, and project management company founded in San Francisco, California, and headquartered in Reston, Virginia. , the ''Engineering News-Record'' ranked Bechtel as the sec ...

Foster Wheeler Foster Wheeler AG (formerly Foster Wheeler Inc.) was a Swiss global engineering conglomerate with its principal executive offices in Reading, UK and its registered office in Baar, Canton of Zug, Switzerland. Foster Wheeler was added to the NASDA ...

Jacobs Jacobs may refer to: Businesses and organisations *Jacob's, a brand name for several lines of biscuits and crackers in Ireland and the UK *Jacobs (coffee), a brand of coffee * Jacobs Aircraft Engine Company, former American aircraft engine compan ...

and

. Since the Shaw buyout, the Power group performed record business in engineering and construction of coal-fired power plants and power plant environmental control retrofits including FGD and SCR technology. Shaw's alliance with Westinghouse led to substantial Stone & Webster technology and engineering applications in the nuclear power industry. In 2008, '' ENR'' ranked the Stone & Webster subsidiary of The Shaw Group subsidiary as first in revenue for Power EPC, and fifth by Revenue in Process & Petrochemical EPC. In 2012,

, a French engineering conglomerate, agreed to purchase most of the Energy and Chemical Division of Shaw Group The remainder of

assets were ultimately purchased by

Chicago Bridge & Iron Company CB&I is a large engineering, procurement and construction (EPC) company with its administrative headquarters in The Woodlands, Texas. CB&I specializes in projects for oil and gas companies. CB&I employs more than 32,000 people worldwide. In May ...

, for about US$3 billion, completing the acquisition in February 2013. A subsidiary that was formed as a result, CB&I Stone Webster—a result of Shaw Groups earlier acquisition of Stone & Webster during its bankruptcy—was again sold, in January 2016, to Westinghouse Electric Co., for US$ 229M.

References

Archives and records

Stone & Webster records
at Baker Library Special Collections, Harvard Business School.

External links

Guide to MS018 Stone & Webster, Inc. Records finding aid
at University of Texas El Paso regarding the El Paso Trolley system
Archived

at FundingUniverse.com
Stone & Webster, Inc - Stoughton, Massachusetts (MA) – Company Profile
at Manta {{DEFAULTSORT:Stone and Webster Companies based in Massachusetts Technology companies established in 1889 Companies that filed for Chapter 11 bankruptcy in 2000 Energy companies of the United States Engineering companies of the United States 1889 establishments in Massachusetts Manhattan Project Construction and civil engineering companies established in 1889