OSI Group was busy making purchases in the year 2016. The company’s first buy, in June, was a food processing and storage facility located in Chicago. The facility, which used to be operated by Tyson Foods, is located near an existing OSI plant and allows the company to support its continued expansion.
Kevin Scott, senior executive vice president for OSI North America, stated that the acquired facility gives the group the capacity to meet the growing needs and expectations of its customer base. Mr. Scott is extremely pleased that the facility is now part of the OSI manufacturing network.
Executives with OSI Group declined to offer other details about the purchase.
A Tyson Foods spokesperson stated that the company had operated the plant for its prepared foods division. In November of 2015, the company announced that it was necessary to close this facility as well as another that they own in Jefferson, Wisconsin, to combat existing inefficiencies. Tyson was able to transfer the workload of these two plants to their other plants that are able to accept the extra capacity.
A Controlling Stake in Baho Food
OSI Group also acquired a controlling stake in Baho Food in August 2016. This company is based in the Netherlands and serves the snack, meat and convenience food industries. As with the other transactions, the financial terms of the purchase were not discussed. With Baho Food added to OSI Europe, the conglomerate has an even bigger stronghold on the European market, according to David McDonald, president and chief operating officer of OSI Group.
Baho Food currently owns Q Smart Life, Bakx Foods, Henri van de Bilt, Vital Convenience and Gelderland Frischwaren, and these five companies all have processing plants in either the Netherlands or Germany. OSI did not oust the firm’s managing director and his team of managers. Instead, OSI worked with Baho to develop a growth strategy for both companies.
After the transaction was completed, Managing Director John Balvers expressed his optimism, saying he looked forward to working with the larger OSI Group. He felt and continues to feel that OSI Group maintains an excellent relationship with both its suppliers and its customers. Once Baho Food became a part of OSI Group, Mr. Balvers expressed his belief that OSI’s capabilities and experience would serve his company very well. By combining Baho Food and OSI Group’s strengths, Mr. Balvers stated that all of their customers would receive tremendous support in accomplishing their goals. He felt that those customers would also benefit from an increased product portfolio. The merger was set to help Baho Food grow at an accelerated rate as well as encourage them to realize their goals.
The Acquisition of Flagship Europe
Lastly, OSI Group also purchased Flagship Europe from the Flagship Food Group in December 2016. Flagship Europe creates dressings, sauces and mayonnaise for the market in the United Kingdom and also provides pies, sous vide products and poultry for this and surrounding markets. Flagship Europe had purchased Calder Foods in order to get a foothold in the food-to-go sector. Calder Foods is a company that is based in the United Kingdom that supplies dips, mayonnaise, sauces, marinades and sandwich fillings.
The chief executive of Creative Foods Europe, Russell Maddock, stated at the time that the acquisition was an inspiring and revolutionary improvement for his company. He also stated that the purchase increased the number of resources that were available to the firm and also expanded their client base as well as the global markets of which OSI Group is a part. According to Maddock, the company would occupy a stronger position in the marketplace as a result of its association with OSI Group, and this would give them new ways to offer their customers better services and would continue to strengthen their business.
OSI would benefit from the partnership as well, according to President and COO David McDonald of OSI. The addition of the U.K. company to their business gave OSI the opportunity to have a greater presence in Europe. The products and brands that Creative Foods Europe owns complement OSI’s processing strengths, and he explained this would help them continue to meet their customers’ growing needs.
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Improvements in Spain
Also in 2016, OSI Group began making improvements to OSI Food Solutions Spain. The production capacity in the Toledo, Spain facility was upgraded with a new, high-capacity production line. With the new line, the company was able to double its production of processed chicken to 24,000 tons per year.
This expansion resulted in an increase of OSI Food Solutions Spain’s capacity to produce a total of more than 45,000 tons of chicken, pork and beef products. Because of the expansion, the company added more people to its staff, to work on the production lines and for related services.
The managing director of OSI Food Solutions Spain, Jose Maria del Rio, stated that the demand for chicken products has been growing at an exponential rate in Spain and Portugal. In fact, there has been a 6 percent average increase in the demand for chicken each year over the past 10 years, but that rate went up to 8 percent three years ago. According to Mr. del Rio, the company expects this demand to continue to rise, and he believes that they are prepared for it.
The company added a 22,600 square-foot building to its campus that contains an employee lounge, nitrogen tanks, hot water tanks, service areas for oil, refrigeration for stored waste containers, storage for facility supplies, shipping and receiving areas and a new production hall. A product development kitchen was also added to address the needs of the company’s clients and consumers.
The company also installed a new perimeter access control surveillance system that augmented its food defense system. The advanced firefighting system and new indoor cameras also improved the defense system as a whole. Besides that, the addition of all of the new equipment has caused the company to reduce its electricity consumption by approximately 20 percent.
The final construction was completed in mid-2017.
OSI Group’s President and COO, David McDonald, expects this expansion to allow the company to offer customers new products and increase the number of retail key accounts, as well as help their long-time clientele to grow. The fact that they are adding a greater number of jobs and increasing capacity is highly encouraging to OSI.
About OSI Group
OSI Group was founded in 1909 as a small meat market and has been a global leader in supplying value-added protein items and other food products to leading foodservice and retail brands since 1955. The company provides food products for food service and retail establishments all over the world. The types of food products this enterprise supplies include beef items, poultry, fish, pizza, hot dogs, bacon and vegetable products. The company’s global headquarters is located in Aurora, Illinois.