February 2, 2010

Fries Finessed into a Fortune

By Lisa Gschwandtner

Spain, France, and Belgium have all taken credit for inventing the french fry, but the Canadian McCain brothers are the ones who managed to corner the market on the frozen potato. Hardly shocking, considering their lineage.

“That’s our background,” Harrison McCain once told a reporter. “Our father was a farmer – a potato dealer and a farmer. Our grandfather was a farmer. Our great-grandfather was a farmer and a land-clearer. He saw a piece of woods, cleared a farm, and started growing potatoes.”

After their father died, leaving them $40,000 each, Harrison and his brothers, Wallace and Andrew, hired 30 employees and opened their first french fry plant in 1957. At the end of that first year, they had produced 1,500 pounds of frozen potato products and made more than $150,000 in sales. Having conquered the Canadian market, they moved to Great Britain, where Harrison opened a sales office in 1965. Today McCain operates plants in 55 countries and exports its products to everywhere from India to South Africa.

Over the years, the company expanded by producing oven-ready foods, including frozen pizzas and desserts, as well as juices. Thanks to its recent purchase of Montreal’s Wong Wing foods, the company also makes frozen wontons and egg rolls. McCain Foods has more than 20,000 employees and has the capacity to produce more than 1 million pounds of potato products every hour. Its annual revenues of more than $6 billion account for fully one-third of the world’s frozen french fry sales.

After squabbling in the early 1990s about who would eventually take over the company, Wallace left McCain Foods and took over Maple Leaf Foods, Inc., in Toronto. In 1995, Harrison hired an outsider, Howard Mann, as CEO, and in 1999 named his nephew Allison as deputy chairman. Wallace still retains a third of the shares of McCain Foods, and although he lived next door to Harrison in the rural town where they opened their first plant, the two never reconciled. Until his death in 2004, Harrison regularly appeared on Forbes’ list of the world’s wealthiest people, with an estimated fortune of $1.2 billion.

Harrison’s nephew, Allison, is described as a steady version of his uncle, a hard-driving man who once estimated that he spent 140 nights a year sleeping in the McCain corporate jet in pursuit of business deals around the world.

Despite the family falling-out, the McCains still take pride in their business. Although Allison initially spent his postcollege years traveling and working at the New Brunswick Telephone Company, he decided to work for his uncle after touring a McCain french fry plant in Scarborough. “I saw a bunch of people who were really excited about what they were doing. They were quite young, very casual, and very un-bureaucratic. I said this was the kind of company I want to work in.”