The Ties that Biden
By Charlie Gasparino
David Richter, the president of Hill International (HIL), a mid-sized outfit that manages construction projects, was speaking last year at a private meeting with investors when he was asked about the recent success of his newest subsidiary, HillStone International.
How was it that HillStone, a newcomer in the business of home building, landed a massive and potentially lucrative contract to build 100,000 homes in war-torn Iraq?
Richter didn’t mince words. It really helps, he said, to have “the brother of the vice president as a partner,” according to a person who was present.
The “brother” Richter was referring to during the meeting is James Biden, the younger brother of Vice President Joe Biden.
Since November 2010, James Biden has been the executive vice president of Hill International’s housing subsidiary despite little if any documented work history in residential construction. And if the company’s projections are accurate, both Hill and Biden are on the verge of a huge payday, beneficiaries, some analysts believe, of James Biden’s connections to the Obama Administration through his older brother.
Indeed, the Iraq project may be the most lucrative single development in Hill’s history. Since 2011, Hill, located in Marlton, NJ., has been losing money; the shares were recently trading at $3.82, down about 28% this year on New York Stock Exchange trading.
And some analysts remain dubious about the completion of the Iraq project, including those at Sidoti & Company, which slashed earnings estimates on Friday. But if company officials are to be believed -- and there’s good reason to believe them given Hill’s connections to the Obama Administration -- Hill will be solidly profitable once the Iraq development gets underway. Company officials say the Iraq project is slated to generate $1.5 billion in revenues over the next three years, more than three times all the revenues Hill produced in 2011.
“I think these guys will come through,” said one former Hill executive who had worked on the development. “You have to realize that these guys are relentless businessmen and they have the right connections.”
And if the deal does happen, a chunk of that $1.5 billion will flow to the biggest connection Hill has to government: James Biden. Hill International owns a 51% stake in HillStone; a group of minority partners, including Biden, hold the rest. That means that the minority partners would split roughly $735 million, pocketing millions of dollars even after expenses are paid.
“There’s plenty of money for everyone if this project goes through,” said Hill International’s chief executive, Irv Richter, who founded the company 40 years ago.
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Alright, Let's hear some Liberal Outrage - but there is only Silence
