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Halliburton to Restructure Subsidiary Associated Press Halliburton Co. said Thursday it is restructuring its troubled engineering and construction subsidiary, and would consider selling or spinning it off should the division's stock performance fail to improve once costly asbestos litigation is resolved. "KBR is on the road to a turnaround," Cris Gaut, Halliburton's chief financial officer, told analysts and investors at a conference in Houston, where the company is based. "We are looking for improvement in the near term. This is not something we can let go on and on and on. It is something that is frustrating for our shareholders." Halliburton is in the process of settling 400,000 asbestos and 21,000 silica claims as part of a $4.2 billion plan. Halliburton inherited most of the claims five years ago when the conglomerate, then under the leadership of Vice President Dick Cheney, acquired Dresser Industries Inc. for $7.7 billion. In afternoon trading, Halliburton shares were up 22 cents at $32.28 on the New York Stock Exchange - near the stock's 52-week high of $32.70, but far below its rivals' shares. Schlumberger Ltd., for example, trades in the mid-$60 range. Gaut said Thursday that the company and the lawyers for the plaintiffs who brought the asbestos and silica claims are eager to move on. However, without a "crystal ball," there's no timeframe for how quickly that will occur, he said. In the meantime, KBR will restructure itself. KBR chief executive Andrew Lane said KBR would reduce its five product lines to two to improve profitability. The subsidiary will focus on its energy and chemicals and government and infrastructure divisions. "We will be a streamlined, efficient and more profitable organization," Lane said. "KBR's strength is in engineering and project management and with this new alignment we plan to further capitalize on our core company strengths and capabilities." Halliburton has been the subject of criticism for its multibillion-dollar contracts in the Middle East, where it has more than 30,000 employees and subcontractors in Iraq and Kuwait. Cheney's ties to the company also have been criticized. He headed the company from 1995 until 2000, when he quit to become George W. Bush's running mate. Several federal agencies, including the Securities and Exchange Commission, are looking into the company's contracts and allegations of overcharging for food services and kickbacks by subcontractors. Halliburton has denied the accusations, labeling itself a political target and victim.
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