Government contracting
Hill prospered in the late 1970s, in part because of the explosion of local construction projects funded by the newly established United States Environmental Protection Agency (EPA). The EPA required the use of the Federal Acquisition Regulation and claims (as "Requests for Equitable Adjustments") became the norm for local procurement. The firm had about 20 full-time employees by the end of 1979. In 1980 the firm opened its first branch office in Washington, DC and began to serve the U.S. government and government contractors from this location.By the 1980s, another series of events in the construction industry fueled a further increase in construction claims and the growth of Hill - the construction of numerous nuclear power plants. The construction of these plants was highly regulated and resulted in overruns in cost and schedule for almost every plant built. Over 46 plants had been commissioned in the 1980s alone.[5] At this time, the Nuclear Power Generating Industry was at the end of a rapid increase in constructing plants and began to terminate many projects. This decline had already begun due in large part to nuclear accidents at Three Mile Island and Chernobyl. This brought another explosion in construction claims for schedule and cost overruns as well as termination claims, including utilities, engineers, and nuclear reactor manufacturers as well as contractors and subcontractors. At this time, Hill brought in William J. Doyle to oversee the growth in nuclear related claims business. Doyle had built a small mechanical contracting company into one of the largest mechanical contractors in the nation, General Energy Resources, Inc., whose core business was subcontracting at nuclear power plant projects. Doyle then served as Senior VP of Northrop Corporation before he became an executive of Hill overseeing much of the nuclear claims work as well as other multi-million-dollar projects.
In the 1980s and 1990s, Doyle oversaw the beginnings of the expansion from a claims consulting firm into a project management company. Hill's initial ventures into Project Management were through a concept called "Troubled Project Turnaround". In 1981, Hill was involved in supporting a major litigation at the Tropicana Casino & Resort Atlantic City where what was supposed to be a $180 million project almost doubled to $300 million. The firm provided technical expertise in resolving the claims and litigation support, and also helped manage the completion of the construction. According to Richter, "... we became a construction manager as a result of that project and eventually also became involved in project management and program management afterward."[6]
Hill continued to expand its management role (re: "Troubled Project Turnarounds") at the City of Niagara Falls, New York. Hill helped the city gain control of the stalled construction of its wastewater treatment plant project and maintain liaison with state and federal regulatory agencies. Hill then acted as the city's construction manager (CM) to complete the reconstruction of the wastewater treatment plant. The city had actually been one of Hill's first clients in 1977 when it hired the firm after having been impressed by its work for a contractor in a claims situation with the city. Similar troubled project CM work took place at the Point Pleasant, PA, Water Intake and Pump Station.
During this time frame Hill became one of the initial Project Management Oversight contractors[7] (PMOC) for the Federal Transit Administration (FTA) during the construction of the Sacramento (CA) Light Rail. Hill next worked for the FTA on the LA Metro. Hill was now included in this FTA list of PMOCs, who were mostly large, established CM firms such as Daniel, Mann, Johnson, & Mendenhall, Fluor Daniel, Parsons Brinckerhoff, and Stone & Webster, among others. By 1984 Hill had opened a Los Angeles Office.
In 1988, Hill expanded its services by acquiring Gibbs & Hill, an engineering / design firm in New York City. Also in 1988, it entered the environmental market by purchasing Kaselaan & D'Angelo (K&D), an air-quality design firm that specialized in asbestos clean-up consulting. The acquisitions raised company revenue to $200 million and increased company size to more than 2,000 employees.
Hill entered the program management service sector in 1991 when it became program manager for the New Jersey Turnpike Widening Program (Interchanges 11–14). This $543 million program involved 9 design sections, 7 construction sections, and more than 50 separate construction and procurement contracts.[8]
In 1993, Hill sold Gibbs & Hill in three parts to United Engineers, then a subsidiary of Raytheon, in 1993[9] and K&D to ATC Environmental, of Mount Laurel, NJ. Hill began a successful turnaround at this time by concentrating on its core construction claims business and seeking to expand its growing construction / project / program management sector.
International expansion
Hill has been "International" since its beginnings. Some CMS clients who became Hill clients were involved with projects in Europe and Africa, including an early iron pellet plant project (in the late 1970s).
In 1981, Hill represented a Filipino labor contractor providing on-site claims and dispute resolution services at King Khalid Military City, a project being built in Saudi Arabia by the United States Army Corps of Engineers. The form of contract was the FAR.
Hill first attempted to open a non-field overseas office in London in 1981 when it hired John A.W. Tanner, an executive with Pullman Swindell (now Swindell Dressler International Co.) The venture was ultimately unsuccessful, and the office closed in 1985.
However, Hill continued to expand its international claims work. Its contacts in the nuclear plant claims arena included General Electric (who used Hill services on its Boiling Water Reactor). GE's overseas subsidiaries also used Hill's services on several claims in Egypt, including the Abu Sultan Power Plant and other projects in the early 1980s. The firm assisted a Spanish joint venture in evaluating their potential claims against the government of Kuwait on a major road modernization project in Kuwait City.
By this time, in 1983, Richter had authored a book, International Construction Claims, Avoiding and Resolving Disputes[10] and the international momentum landed Hill in Abu Dhabi with an independent overseas office that was turning a profit from the start. Hill had landed the role as a lead consultant for the Abu Dhabi Claims Committee.
Becoming a public company via a reverse merger
Richter had always envisioned Hill as a public company. The company's financial difficulties of the mid-1990s, however, made the approach of going public through an IPO unattainable. In 2004 Arpeggio Acquisition Corporation of New York was formed in April as a "blank-check company"—meaning its business activities had not been determined. It was established for the sole purpose of buying a company within 18 to 24 months of its initial public offering.
On December 5, 2005, Arpeggio and Hill announced that they entered into a merger agreement. Under the terms of the agreement, Hill's shareholders received 14.5 million shares of the common stock of Arpeggio at closing and owned 63.6% of the combined entity. When the deal closed on June 28, 2006, Arpeggio changed its name to Hill International, Inc. and on June 29 began trading as HINT on Nasdaq.
When HINT began trading on Nasdaq on June 29, 2006, the price of HINT was $5.30 per share. At the end of the year the price was $7.15 per share. Hill achieved record revenue of $197 million with record net income of $11.3 million. Most of this was due to organic growth in the Project Management sector of the company. With the cash infusion from going public Hill could now begin a series of acquisitions and mergers that would grow the company as Richter had envisioned previously.
Hill made one immediate major acquisition in 2006 after going public – the purchase of J. R. Knowles (the largest construction claims company in the world) for $13 million.[12] As a result, Hill assumed the title of the largest claims firm in the world. The Knowles acquisition also provided access to new markets in Southeast Asia, Australia, and Canada.
