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Saturday, January 17, 2004

Too big for their bridges? Not likely



By Mike Boyer
The Cincinnati Enquirer

[IMAGE] Patrick M. Harlow, president of Contech Construction Products, in front of a company-made metal bridge on Town Road in Middletown.
(Ernest Coleman photo)
MIDDLETOWN - Contech Construction Products Inc. sees a big future in little bridges.

The company, spun off 17 years ago from what is today AK Steel, has been a supplier of metal culverts and conduits for site development and water drainage for a century. But in one of several diversification moves over the last couple of years, it has also become a national supplier of prefabricated, two-lane metal bridges.

"One of the huge growth spurts in our company is in this small, two-lane prefabricated bridge market,'' said Patrick Harlow, president and CEO.

The company, which has 1,700 employees and nearly 40 plants nationally, is one of Greater Cincinnati's largest private companies with sales last year of $480 million, ranking it sixth on the Cincinnati 100 list of privately held firms.

Now owned by Butler Capital Corp., a New York investment firm, Contech employs fewer than 100 at its nondescript one-story offices in the shadow of AK Steel headquarters.

Although Contech has supplied corrugated steel for bridges since the 1930s, in 2001 it acquired Steadfast Bridge Co. of Fort Payne, Ala., and Continental Bridge of Alexandria, Minn. The two competitors made prefabricated bridges up to 130 feet in length, mainly for golf courses and hiking trails.

"What we saw was an opportunity to expand that into the county road market,'' Harlow said. "There are a tremendous amount of deficient county bridges around the country that will be replaced over time.''

INNOVATION IN BATTLE
A key objective in the war in Iraq was taken with some Navy Seabee ingenuity and aluminum conduit supplied by Middletown's Contech Construction Products Inc.

In the drive to Baghdad last March, Navy Seabees used Contech's conduit to cross the 100-yard wide Saddam Canal outside Nasiriyah, but not the way Contech envisioned.

One of Contech's products is corrugated aluminum plate in 100-pound pieces, which can be bolted together in the field to form conduit to channel water.

Patrick Harlow, Contech president, said while the Seabees had extension bridges in their arsenal, none was long enough to span the canal and U.S. troops didn't want to use the Nasiriyah bridge for fears it could be mined.

On the spot, the Seabees bolted Contech's metal plates together and set them in the canal bed on end, filling them with dirt and rock, to create piers to for their extension bridge.

Contech showed its own flexibility in filling the Navy's need for the aluminum plate shortly before the attack on Iraq.

The company was in the midst of moving forming equipment from Anderson, S.C., to a plant in Winchester, Ky., when the Navy said it needed the product shipped to Kuwait in 41 days.

"We turned the trucks around and sent them back to Anderson and reinstalled the equipment so we could do the forming, " he said, meeting the deadline.

The federal government estimates it will take $10 billion to replace all the nation's deficient bridges, he said.

"It's a huge problem and something that's going to be self-funding forever,'' said Harlow, recruited in 1999 as Contech's president after 21 years at Ingersoll-Rand Co.

"The problem is most are made out of concrete and to replace them requires removal of the existing bridge and shutting down the road for six to eight weeks (for construction) and the diversion of traffic,'' he said.

Contech's prefabricated bridges can be installed in less than a week, at a fraction of the cost of a poured concrete span.

"We think that the bridge side of our business is going to be $200 million (in sales). And it was nothing two years ago.''

"We've installed about 70 bridges,'' he said. "Our quotation backlog today is $67 million, and we're closing about 20 to 25 percent of those,'' Harlow said.

Until recently, Contech has grown primarily by acquiring local suppliers fabricating its metal conduit. The business tends to be regional or local, because it costs too much to ship large pipe very far.

In the process of reacquiring franchises, Contech has developed a sales force of 172, most of whom are civil engineers, and a national footprint that now gives it an edge.

Harlow said Contech hopes to duplicate its growth in corrugated steel pipe market in the local bridge market.

"We are looking for more acquisitions,'' he said. ''There are about a dozen small or regional, prefabricated steel bridge makers around the country. And we're interested in all of them.''

More than half the company's sales are now from supplying metal conduit, but Harlow said that business isn't growing much, so Contech is leveraging its expertise and sales network into other products such as two-lane metal bridges.

The other initiatives include:

• Expanding into the pre-cast concrete arch business. Last May, Contech acquired U.S. rights for pre-cast concrete arch technology developed by a Swiss company, BEBO Arch International AG.

Using the technology, Contech can design and build pre-cast concrete arches, which cost about 40 percent less than traditional poured-in-place concrete arches.

"They were doing about $4 million a year in concrete arches (in the United States). We have quotation backlog today of $26 million,'' Harlow said.

• Developing a network of suppliers around the country to produce the pre-cast concrete arches using the technology.

"That could easily be a $100 million business for us in the next five years,'' he said.

• An alternative to retention ponds.

This third growth area was created by new federal rules requiring site developers to come up with waste-water cleanup plans for all projects of five or more acres.

In 2002, Contech teamed up with Vortechnics Inc., a Portland, Maine, maker of storm water treatment systems.

Instead of traditional storm water retention ponds, Contech is marketing to site developers enclosed systems marrying Vortechnics' storm water cleanup filters with underground conduit it supplies to collect and hold the water, much like a traditional underground septic system for sewerage.

"We think it's a huge growth opportunity, especially in urban areas where developers can't build retention ponds,'' Harlow said.

Contech has installed $15 million of Vortechnics' products last year and the new federal rules are just taking effect.

E-mail mboyer@enquirer.com



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