U.S. meat supplier OSI Group said Monday that it was suspending operations at its Chinese subsidiary after media reports tied it to China's latest food scare.
OSI, based in Aurora, Ill., said Shanghai Husi Food Co. failed to comply with the company's safety standards after it conducted its own internal investigation following last week's TV report that Husi was selling expired meat to fast-food chains.
"I am appalled that something so completely unacceptable has happened in a company that I own," said Sheldon Lavin, the group's owner. "I will not try and defend it or explain it. It was just terribly wrong."
Neither OSI nor the Chinese food safety agency has confirmed that the plant sold rotten meat. However, OSI said it pulled all products manufactured by Shanghai Husi and replaced its management team in China, stating that it "will take swift and decisive action against those responsible" for the meat scandal.
Although OSI did not say how Husi violated safety standards, David McDonald, OSI's president and chief operating officer, said the company is bringing in experts to monitor China operations and is spending $1.62 million on a food safety program in Shanghai.
OSI said it would also review all nine of its China plants after Yum Brands Inc., whose KFC and Pizza Hut chains bought meat from Husi, cut ties with the U.S. company.
McDonald's did not confirm if it continues to work with OSI, which has been supplying McDonald's Chinese restaurants since 1992.
The fast-food giant, which has about 2,000 locations in China, said it is now offering a "limited" menu absent most burgers and pork and chicken options. Some Beijing locations are offering only fish sandwiches.
"We are leveraging our network of suppliers to resume our full menu offerings," said Becca Harry, director of global media relations for McDonald's. "Some restaurants will resume offering full menu in early August and some may take a little longer."
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