From the Ground Up - McCain Foods Limited

Shepody harvest, western
Idaho.
operating officer at Maple Leaf Foods, Canada’s largest food company. His sixteen
years at McCain Foods had prepared him for the challenge. “Most of my time at
McCain was in very messy, turnaround situations,” he says. “They were challenging,
but also great learning experiences and opportunities to make a difference. The best
part was the hundreds of committed, highly capable professional people I had the
honour of working with.”
When Lan followed Michael to Maple Leaf Foods, Peter Reijula, a veteran food
industry executive and until then vice-president of sales of McCain Citrus Inc., took
over as CEO of McCain Citrus.
In 2000, McCain, following its strategy of pursuing consolidation in the juice business,
tried to buy its chief rival from a group of venture capitalists, who countered
with a generous offer for McCain Citrus. That offer was accepted. In the end, McCain
made a handsome return on its investment in the U.S. juice business. “We bought
something that was trouble but did very well at it over time,” says Hanscom.
When McCain Citrus was sold, McCain Foods, although a growing force in the
United States in the french fry business, was still not a major player. This state of affairs
would soon change.
One day in 1997, CEO Howard Mann was meeting with Harrison when the latter
took a phone call from Wallace, who was passing on word from Michael McCain that
the food service business of Ore-Ida, owned by H.J. Heinz Co., might be for sale. Both
Wallace and Michael were now working for Maple Leaf Foods but, as shareholders,
they continued to be interested in the well-being of McCain Foods. “Harrison promptly
called Heinz chairman Tony O’Reilly, with whom he had had frequent personal contact
over the years,” recounts Mann. He wanted to know if Ore-Ida really was for sale.
O’Reilly said, “If you’re interested, let’s talk.”
Harrison and Mann were soon on the McCain plane bound for Pittsburgh, world
headquarters of Heinz. It was a trip that would vault McCain Foods into the major
leagues of the U.S. food business. The $500 million purchase of the Ore-Ida food
service business brought two major potato-processing plants and three appetizer factories
into the McCain fold. The potato factories are located in Plover, Wisconsin,
and in Burley, Idaho. The appetizer plants are in Fort Atkinson and Rice Lake, both
in Wisconsin, and in Grand Island, Nebraska.
In 1997, Harrison McCain asked Gilles Lessard, then CEO of McCain’s continental
Europe operations, to go to the United States as chairman of McCain USA and supervise
the integration of Ore-Ida. It was a big change for Lessard; in Europe, McCain
was a strong player with a well-known brand, whereas in the United States, it was
small and unknown. Fifteen other McCain executives arrived from around the world
to help him.
At the time, Frank van Schaayk was global account manager for the McDonald’s
business, a job that Bob Cornella took over as corporate vice-president of the
174 f rom the Ground up
south of the border 175
toP LEFt: Meeting of potato
growers in Plover, Wisconsin,
2000.
toP RIGht: Bug’s-eye view
of Kerry Larson, McCain
agronomist, in Wisconsin.
bottoM: Gilles Lessard,
chairman McCain Foods USA,
c.2000.