Joint Venture With Japanese Company
San Joaquin Valley - Land O’Lakes, Inc. (Arden Hills, Minn.) And Mitsui and Co., Ltd. (Tokyo, Japan) today announced the establishment of a joint venture focusing on the development of a world-class cheese and whey production facility in California’s Central Valley.
The initial structure of the venture will be a limited liability company, with Land O’Lakes holding 70% ownership and Mitsui holding a 30% share. Additional joint venture participants, from California and Japan, are anticipated as the project moves forward.
The plant, with an initial capacity of 3 million pounds of milk per day, will produce Mozzarella and Cheddar cheese, dried whey and whey fractions. It is expected to be in operation by early 2001, with a significant expansion (bringing the plant’s capacity to approximately 6 million pounds of milk daily) anticipated by 2003. The estimated cost of the project is $145 million.
Land O’Lakes President and Chief Executive Officer Jack Gherty said the project reflects Land O’Lakes commitment to being a leading supplier of dairy ingredients...particularly whey products... both domestically and globally, and will place the company in an even stronger position to serve the domestic market for Mozzarella and Cheddar cheese.
“This world-class facility, located right in the heart of North America’s most productive milk shed, offers significant potential for both Land O’Lakes and Mitsui,” Gherty said. “Further, the international nature of this new partnership can open the door to new global opportunity for both our organizations.”
Jack Prince, Land O’Lakes Executive Vice President and Chief Operating Officer for the Dairy Foods Commodity Business, said the new California plant is only the one part of Land O’Lakes dairy industry investment strategy.
“We are making major investments in upgrading, expanding and modernizing our East Coast, Midwest and West Coast production facilities,” Prince said. “We are committed to maintaining and growing market access for our 6,000 dairy producer members, and to ensuring the highest quality products and service for our customers. To do that, we must maintain a strong national procurement, processing, distribution and marketing system.”
Land O’Lakes (http://www.landolakesinc.com) is a national farmer-owned food and agricultural cooperative, with sales in all 50 states and more than 50 countries. It is a leading marketer of a full line of dairy-based consumer, food service and food ingredient products across the U.S.; serves its international customers with a variety of food and animal feed ingredients; and provides farmers and local cooperatives with an extensive line of agricultural supplies (feed, seed, plant food and crop protection products) and services.
Tulare - Representatives of Dairyman’s/Land O Lakes (LOL) met with city of Tulare and County officials this past week to go over a possible location for a new cheese/whey plant in town.
The meeting comes two weeks after the big Minnesota based milk co-op announced plans for a 6 million pound a day cheese plant along with a separate whey manufacturing facility.
However, the company did not announce its location except to say it would be in the central valley. Later a local representative said the plant would likely be in Tulare County or nearby. But the city of Tulare - Dairyman’s hometown - is betting the company really wants to locate on a 36 acre parcel the milk co-op already owns that includes a 300,000 sq ft facility on Paige - the former Kraft/CPC facility.
That property was recently included in an expansion of a city redevelopment district - an expansion that will require County of Tulare approval. The meeting this week included County redevelopment officials along with Supervisor Mel Richmond. Richmond had said after the meeting that it was his sense that the company would like to locate the major new facilities in the city of Tulare. “They need lots of infrastructure,” he said.
Doug Wilson, the County’s Resource Manager said the city of Tulare redevelopment plan would need a study by County staff that would take at least 6 weeks before the matter would go to the Board of Supervisors. At that time it is likely to go on the agenda as a Closed Door item.
The new redevelopment district could mean the county might lose some revenues. The city of Tulare could use millions generated from the redevelopment zone to put in infrastructure, roads, rail or sewer in the expanded district that could help LOL expand there. It could also be used as financial incentives to LOL if the city chose to do so.
Sources familiar with the situation say that the company is likely negotiating its best deal with the city and that’s why no announcement has been made. Company officials have hinted at “other options” besides a location right in Tulare.
An LOL official told the Voice that the new facility would include a partnership with another company and that the entity that actually runs the plant could be a new joint venture company. Employment is expected to be about 140.
Editors note: When do rumors become news? When candidates act on those rumors and there are tangible counter actions by opponents. Here’s one good example. Is it a mountain out of a molehill or big news? The usual mudslinging or corrupt politics? You decide. JL
Visalia - Candidate Wally Gregory confronted persistent rumors swirling around his campaign this week that his treasurer George Ouzounian offered financial support to two other candidates. There are two seats open in the November 2 election - now only days away.
Ouzounian’s role is in question in part because the Visalia real estate company owner wears two hats. On the one hand he is the prime advocate and spokesman for the controversial regional development on Plaza and 198 being proposed by the well known Fresno developer Ed Kashian. (See Kashian story) He is the listing agent on the property. The project is pending city approvals.
On the other hand he is also the treasurer for the re-election of Visalia mayor Wally Gregory who will have to vote on the merits of the big development.
Gregory’s campaign manager, Lane Fye, had called the Valley Voice, the Bee and Times Delta last week saying that Gregory’s campaign “absolutely did not do that” (offer financial support to any other candidates). Gregory says if Ouzounian met with candidates Roy Ludwig and Wendy Thomason to gauge support for the Kashian project, it wasn’t on Gregory’s behalf.
“I didn’t know anything about it,” says Gregory this week. “If there is confusion over who Ouzounian was representing we (the Gregory campaign) apologize for it,” says Fye.
Asked if he met with other candidates Ouzounian told the Voice “no comment,” and referred us to Gregory.
Gregory says there was a meeting that included Ouzounian with Roy Ludwig talking about the possibility of raising money for Ludwig’s candidacy. Gregory says there was talk of $25,000 or more needed to win a campaign but he says this wasn’t an offer for money. Nor was there indications it was coming from Kashian people, says Gregory. There is nothing illegal about raising money to support the candidate of your choice although donations over $99 have to be reported.
Ludwig who quit the race this week said he couldn’t comment on these events. Friends says Ludwig is exhausted from the ordeal. Asked if Ouzounian met with candidate Wendy Thomason and made a similar offer of support, Gregory says he has not asked Ouzounian but that he will.
Thomason told the Voice “In late August or early September I got a call from George Ouzounian who said he wanted to ask me about some issues. We met at Visalia Coffee Co. for about half an hour. He said he was a supporter of the Kashian project and asked me my view. Then he asked ‘What would $25,000 for your campaign do for you.’ I said it could do all sorts of things. Then he asked if I would publically support the Kashian project. I turned him down.”
Thomason said that as a sitting planning commissioner she was precluded by law from taking any contribution on a project that was coming before her.
“I didn’t think much of it till I got a call from Roy Ludwig asking me last week if I had been offered money?” she says.
“Since then I figured if there is nothing wrong with this then it’s my misunderstanding. But people have been hounding me so much on this I feel the public needs some type of comment from me,” explains Thomason.
Gregory says he personally sought no money from the Kashian people and has not received any. “I would never do that,”he says.
In the past week rumors pushed Wally Gregory to try to find out “who is behind them.” In the course of doing this he made a call to Ludwig’s employer - Gabe Pena of Tulare County Recycling - a company who has a contract with the city of Visalia. Ludwig serves as manager for the Lovers Lane complex. “Gabe and I go back a long way. I just asked him to keep his ears open and see if we could cool this thing down. I was trying to help Roy,” says Gregory. He says he absolutely did not threaten Ludwig’s job nor the status of the contract.
“Everybody is trying to take pot shots at me,” says the mayor who is clearly the front runner in this race - a campaign in which the Kashian project and growth is virtually the only controversial subject.
Gregory says he doesn’t know how the rumors started but says candidate Ludwig “was no threat to me” and “that there would be no reason that I would want to do anything to him.”
Ludwig started his campaign this summer as a virtual unknown with no campaign
organization. Gregory says Ludwig asked Gregory if he could “tag along
on my coattails.” Gregory says he did not encourage this but also didn’t object
to it.
He attended some of Gregory’s fund raising gatherings.
But Ludwig failed to gain adequate financial support and Gregory says Ludwig told him “your group did not live up to what you said” that is offer financial support. “I told him I don’t know what he was talking about,” says Gregory who heard the next day (Saturday, October 16) that Ludwig had taken himself out of the race. Ludwig has said he may try again in two years.
In the one and only campaign forum this past week, Ludwig criticized the Kashian project saying it was not in accord with the city’s long term 2020 plan - a clear distinction of his position with Gregory. For Gregory’s part he has been an advocate for it at some forums like the Hispanic Roundtable, but other times says he simply wants the project to be considered.
Gregory says he won’t be swayed on the Kashian project by Fresno money and notes that “I voted against plenty of projects from campaign supporters because the land use is wrong.” He said in the Forum this past week that in eight years he has never gone against the city’s 2020 plan and won’t. But the Kashian project would require a major departure from that plan that seeks to keep regional commercial development closer in and away from Highway 99. Gregory says he considers the Kashian project promising because of the importance of sales tax generation to the city and the number of jobs it might bring in. (1200 according to the number announced by Gregory at the Hispanic Roundtable meeting.)
Regarding a flood of calls from newspapers - even reports that the San Francisco Chronicle wanted to do a story on this brouhaha a frustrated Gregory says, “I don’t really need this job but I want people to know I’ve worked my ass off.”
Regarding Ludwig’s candidacy - the name will still appear on the ballot and of course all this attention he is getting now could turn it around for him. Stranger things have happened. He told the Times Delta this week that if he won he isn’t sure what he would do.
Visalia - Fresno developer Ed Kashian has seen the writing on the wall. The proposed 18 screen movie theater had become an anchor weighing down the political survival of the proposed 60 acre regional shopping center being planned at Plaza and 198.
This week the company removed the 4000 seat movie theater from the plans being submitted to the County Airport Planning Commission and the City of Visalia.
Proponent George Ouzounian, who is spearheading the drive to approve the project, says he expects the County staff to allow the project without the movie theater since language in the County Airport Plan prohibited auditoriums. Instead the shopping and entertainment project will not be so dense as to reach the threshold allowed by the FAA approved rules near the airport’s approach zone.
The movie theater had also galvanized opposition from downtown supporters who don’t want to see a big movie theater kill the new 10-plex Signature Theater.
The news comes as opposition to the Kashian project continues to be seen in the recent election forum held at the Visalia Convention Center. There all the candidates but Wally Gregory knocked the project as being against the city’s 2020 growth plan that encourages development only within the city’s existing commercial boundaries.
Even without the movie theater as part of the project, the regional retail companies will have an entertainment theme with proposed family fun center and race track among the proposed big box retailers that seek to locate there to attract regional customers. The project now totals 600,000 square feet - about six Costcos. But even without the theater the project is likely to remain controversial. Mooney property owners including both malls, have argued against it in part because it could gut the draw of Mooney Blvd. as the city’s prime shopping area.
Ouzounian has said although the movie plans will be pulled for now, he believes the development should have the right to revisit them later in the event the airport flight path would change in the future. Currently some planes circle over the proposed project on their approach making a dense development like a theater hazardous.
The above stories are the property of The Valley Voice Newspaper and may not be reprinted without explicit permission in writing from the publisher.
October 20, 1999
