Borden (company)

Borden, Inc., was an American producer of food and beverage products,

After significant financial losses in the early 1990s and a leveraged buyout by private equity firm Kohlberg Kravis Roberts (KKR) in 1995, Borden divested itself of its various divisions, brands and businesses. KKR shut Borden's food products operations in 2001 and divested all its other Borden operations in 2005. Borden dairy brands are currently used by Borden Dairy for milk and by Dairy Farmers of America for cheese.

History

Founding

The company was founded by Gail Borden Jr., in 1857 in Connecticut as "Gail Borden Jr., and Company." Its primary product was condensed milk. Struggling financially, the company was saved when Jeremiah Milbank, a partner in the wholesale food distributor I. & R. Milbank & Co. and the son-in-law of banker Joseph Lake, agreed to invest and acquired 50 percent of the stock. The company changed its name in 1858 to the New York Condensed Milk Company. The company prospered during the Civil War by selling condensed milk to Union armies.

Borden began selling processed milk to consumers in 1875 and pioneered the use of glass

(Left): Advertisement for Borden's Eagle Brand Condensed Milk and Peerless Brand Evaporated Cream in an 1898 guidebook for travelers in the Klondike Gold Rush; (right): York Ice workers packaging product, 1938

The company changed its name to "Borden's Condensed Milk Company" in 1899. It suffered a legal setback in 1912, when a federal appellate court held that the Borden Ice Cream Co. (a competitor whose ownership included one "Charles Borden") could sell ice cream under the Borden name because Borden's Condensed Milk sold only milk, not ice cream,

Two Borden factories in early 20th century, (left): plant and workers in Michigan, 1908; (right): plant in Illinois, 1911

Borden became a

Borden milk products in Canada began with condensed milk in Quebec and East Coast with headquarters in Montreal.[3] Borden's Canadian operational head office moved to Toronto in 1931 when it acquired City Dairy. The old City Dairy Stables on Spadina Crescent was renamed Borden Stables and now part of the University of Toronto. Borden's Canadian operations slowly disappeared with Quebec operations to Agropur in 1976 and Ontario operations to Silverwood Dairy in 1980.^[4]

In the 1950s, Borden moved into the

The food products division was spun off as Borden Food Corporation when Borden, Inc. became a holding company in 1929. The holding company reversed itself 13 years later when it reacquired its child company.^[1]

In the 1950s, the parent company went on a buying spree, swallowing up companies such as Wyler's, which made bouillon and powdered soft drinks; ReaLemon, a manufacturer of synthetic and reconstituted lemon juice; Cracker Jack (sold to Frito-Lay in 1997); Campfire brand marshmallows; Wise Foods, a maker of potato chips and other snack foods; and Bama, makers of jellies and jams.^[1]

Although Borden retrenched in the inflationary 1970s, it embarked on a second wave of mergers and acquisitions in the 1980s. It purchased Guys Snack Foods in 1979. It also purchased the Prince pasta manufacturing concern (giving Borden 30 percent of the domestic pasta market).^[1] In 1986, it purchased the dairy products division of Beatrice Foods, including the Meadow Gold brand.^[5] Stockholders blamed the company's decline on mismanagement, the incurrence of excessive debt to finance its numerous acquisitions, and several recent restructurings.

Demise

Borden suffered significant losses for the period 1991–1993. A 1991 restructuring failed to integrate the company's brands and marketing efforts. When whole milk prices dropped in 1992, Borden Food did not lower its prices—causing a significant drop in market share from which it was not able to recover. Borden divested itself of nearly a third of its businesses in 1993 but could not find a buyer for its snack food concerns. In deep financial difficulty, Borden was bought out by Kohlberg Kravis Roberts (KKR) in 1995.^[1]

KKR increased the pace of divestiture but was unable to right the company. The company's Borden/Meadow Gold Dairies subsidiary was sold in September 1997 to Southern Foods, controlled by the Mid-America Dairymen (later the Dairy Farmers of America). Borden licensed the use of Elsie the Cow but retained ownership of the trademark.^[6] Southern Foods was acquired by Suiza Foods (now Dean Foods).^[7] The dairies are now owned by Dean Foods and Borden Dairy. Dairy Farmers of America retains Borden cheese.

In 1997, KKR focused the company solely on its pasta and pasta sauces lines.

Borden, Inc., sold its final food product line, It's Pasta Anytime, to Kraft Foods in 2001 and shuttered its Foods division.^[8]

With the chemicals business the sole remaining operating company, in 2001 KKR merged Borden, Inc. into Borden Chemical, Inc., with the resulting company named Borden Chemical to emphasize the fact that chemicals were the company's sole remaining product line.^[9]

In 2004, KKR sold Borden Chemical to

Borden once operated a chain of ice cream stores called Borden's Ice Cream, but only a single location in Lafayette, Louisiana, remains, under local ownership.^[12]

Legacy

Several firms continue to use the name Borden and Elsie the Cow:

• Dallas, Texas.^[13]
• Eagle Family Foods Group LLC uses the name and Elsie for Eagle Brand canned milk products.

The Borden Buildings (North Building 563 Spadina Crescent and South Building 487 Spadina Crescent) in Toronto were once home to Borden Canadian dairy operations (founded in 1900 by Walt Massey as City Dairy) and are now used by the University of Toronto.^[14]

Former brands

See also

• Borden Milk Plant
• Rotolactor

References

Sources

• "Apollo Buys Borden Chemical for $649 Million." New York Times. July 7, 2004.
• Buchanan, Doug. "Borden Foods Turns Out the Lights, Sells Final Holding." Business First of Columbus. August 27, 2001.
• International Directory of Company Histories. Vol. 22. Farmington Hills, Mich.: St. James Press, 1998.
  ISBN 1-55862-363-9
• Jensen, Elizabeth. "Crackerjack Plan? Borden to Sell Some Food Brands." Wall Street Journal. March 21, 1997.

Wikimedia Commons has media related to Borden (company).

• Borden Document Archives website
• Hexion Speciality Chemicals website