Samsung C&T unveil plans to revive Whessoe of Darlington

ON the icy shores of Deception Island at the edge of Antarctica lies the rusting remains of a century old whale oil tank made by Whessoe Foundry in Darlington.

Steve Kim, chief executive of Whessoe, Darlington

Even Samsung - regularly ranked among the 20 biggest brands in the world - would struggle to match that kind of global reach.

The Whessoe name can trace its origins back to an ironmonger's shop opened by Quaker William Kitching in 1790.

It grew into an international group of companies which designed and manufactured almost every type of engineering product: from railway locomotives to reactor vessels for Britain's first nuclear power station. 

Tellingly, when Samsung's Construction and Trading (C&T) division bought what remains of the once mighty Whessoe from Al Rushaid Group in March it chose to retain the famous name.

NEW ERA: Rasheed Al-Rushaid, left, shakes hands with Yeon-Joo Jung, chief executive of Samsung C&T after the deal was signed  

"Whessoe has a far better brand value in this particular market than Samsung," admits Steve Kim, new chief executive of the Darlington firm who hands me a business card that proudly bears the name Whessoe in big bold type, with the words A Subsidiary of Samsung C&T in a smaller font beneath.

"We acquired the business for its engineering talent and for its history," says Seoul-born Mr Kim, 57, who spent 32 years working for oil and gas firms such as Exxon and Saudi Aramco.

"You see the Whessoe brand name worldwide. It is very well known. We have brought that pedigree into the group."

Samsung C&T is the oldest division of the multi-national that is best known for making smartphones, tablet computers and televisions.

When the South Korean firm started in 1938, Whessoe was already world-renowned and about to support the war effort by making hulls for Churchill tanks as well as parts for Mulberry Harbour and landing craft used during the D-Day landings.

WAR EFFORT: A consortium of Whessoe, Head Wrightson, Cleveland Bridge and Cargo Fleet built 238 landing craft ready for D-Day in 1944. About a quarter of them are pictured

There was seemingly no engineering challenge the workers at Whessoe's myriad divisions couldn't turn their hands to - from building wind tunnels for the RAF to supplying the ironwork that supports tunnels on the London Underground. 

In 1959, they built the world's first liquefied natural gas (LNG) import terminal, at Canvey Island in the Thames Estuary.

The scope of Whessoe's engineering capability in the North-East has diminished greatly over the last 50 years. Its engineering works at Brinkburn Road, Darlington closed in 1989. But its expertise in LNG storage is a sector it continues to lead.

Mr Kim continues: "In our view Whessoe has the best engineering know how when it comes to cryogenic engineering and LNG-related design capability.

Mr Kim also believes there are significant opportunities in the treatment and storage of gas.

"Samsung's business models calls for the venture into the energy market. This acquisition adds to our value chain," he says. 

He talks about a recent multi-billion dollar project that Samsung C&T completed in Singapore.

"The unfortunate thing was that we did the procurement and construction work but the engineering was done by someone else because we didnt have the capability. Having Whessoe now gives us that capability."

He reveals that a major new project in Europe is on the horizon.

Plans are also in place to start a graduate training programme next year.

"It is a challenge for us to find the right people because this is a very high end engineering business. You have excellent education facilities at Teesside, Durham, Sunderland and Newcastle universities, meaning there is a local talent pool," says Mr Kim, who has already started to replenish the depleted workforce at the firm's Morton Palms offices on the outskirts of Darlington.

Staff numbers dropped alarmingly by more than 300 over the last five years to just 60. The plan is to triple that by 2015 with at least 23 people joining this year.

How were things when you took over?

"Very grim, "reveals Mr Kim. "There was a clear sense of aggravation among the staff. They had been through a tough time.

"Had we taken over Whessoe two years earlier it would have been a lot easier. But we are building it back up quickly and making tremendous leaps and bounds.

"We've spent millions on IT infrastructure. Everything is brand spanking new - servers, software - because our engineering talent needs the best possible tools to be at the forefront of innovation.

"It's mind boggling to me why the previous owners let things run down into the ground. We have been building up basic business infrastructure, such as new HR policies so we can work as a team with Samsung C&T in Seoul," he says. 

Did staff fear that the business would close earlier this year? Martin Grewer, Whessoe engineering director, replies: "Yes. It was getting to the point where there weren't sufficient people left to sustain the business.

"It was a sad period because you could still see the potential of the company. The previous owner never visited us here in Darlington whereas Samsung C&T's top people have already been to the site. There's a totally different outlook.

"We now have the market penetration that a company like Samsung can give." 

Mr Grewer adds: "The mood has changed so much in the last few months. They have a commitment to grow the workforce and want to make this an engineering centre of excellence for Samsung C&T.

"We lost a lot of people but many good staff stayed. There is a real loyalty. Whessoe is a special business and Samsung seem to understand that."

To assist the transition four senior staff joined from South Korea of whom two will return in the coming months.

Mr Kim explains that from the outset he was determined to retain the Darlington team and he is delighted to be able to draw on the knowledge of people such as Wilf McNaughton, Whessoe's vastly experienced general manager.

Mr Kim says: "Our success lies with the talent that is here. We believe the new people should be coming from the surrounding area more so than the Samsung side. Indeed our vision is that Whessoe here in Darlington becomes the core engineering centre for Samsung C&T globally."

Has integrating the businesses thrown up any cultural differences?
Mr Kim replies: "Koreans tend to be workaholic, very competitive and spend hours focussed on a task. But they often don't have time to think through a solution to a problem.

"People here are more laid back but they come up with breakthrough ideas. The British are famous for innovation.

"Put the two together and there is a winning combination."

Would he like to engender a Korean workaholic culture in Darlington?

"No. We want to retain the qualities that make this site so strong - innovation and engineering excellence. I have no desire to change anything in that respect.

"We are proud to be in this region. We are here to stay for a long time."

Whessoe history:
The name Whessoe is an ancient word refering to a Saxon village that once stood to the north of Darlington.
1790 William Kitching opened an ironmonger's shop at the top of Tubwell Row, Darlington.
1796 Kitching started a foundry at the back of the shop to cast chimneys and cater for local mills and agriculture.
1821 His son William subscribed 400 to help the newly-formed Stockton and Darlington Railway (S&DR) get up and running.
1824 William got his first contract from the S&DR: 15 guineas-worth of nails to fix the rails to the sleepers.
1831 William and his brother, Alfred, had so much railway work they  move to bigger premises at Hopetown beside North Road station.
1845 Built their most famous engine The Derwent, which now stands in the North Road Railway Centre. The Kitchings later took over the neighbouring foundry, run by William Lister, in Brinkburn Road.
The brothers retired, selling the Hopetown works to the railway and the Brinkburn Road foundry to their cousin, Charles Ianson who called it Whessoe Foundry.
1884 Ianson died, and in 1891 the Kitching family sold the business to engineer William Coates, who renamed it the Whessoe Foundry Company Limited.
1920 Floated on the Stock Exchange. 
Until the late 1960s Whessoe employed as many as 3,000 workers on the site in Brinkburn Road.
1989 Brinkburn works closed as firm moves out of heavy engineering and the offshore industry. Whessoe now employed fewer than 400 staff at a hi-tech factory in Newton Aycliffe and Darlington offices.
1990 to 2004 Separated from Whessoe PLC, the company was reformed to eventually become known as Skanska Whessoe, operating worldwide, specialising in refrigerated and pressurised liquid gas storage facilities, from concept through to commissioning.
2004 Acquired by the Al Rushaid Group, the largest oil and gas service company in the Middle East.
2006 Moved from Brinkburn Road to become the first tenant in the  Morton Palms development, on the edge of Darlington.
2013 Acquired by Samsung C&T Corporation.

Samsung C&T history.
1938 Established in Seoul as the original company of the Samsung Group, South Koreas largest conglomerate with interests in sectors such as construction, electronics, chemicals and finance. 
The engineering and construction group is responsible for several of the worlds tallest buildings including Malaysias Petronas Towers and the Burj Khalifa in the UAE.
It has a strong reputation in the power plant and energy fields.