Parmalat suffers public floatation setback
relist on the Italian stock exchange rebuffed, after Italian stock
market regulator Consob raised questions yesterday over its future
restructuring plans, Tom Armitage reports.
Consob reportedly sent Parmalat a nine-page document requesting more information concerning its overseas subsidiaries, as well demanding further explanation in relation to its current legal exploits.
Enrico Bondi, the government-appointed administrator in charge of Parmalat's restructuring efforts, has been working frantically towards achieving a public floatation in the first half of this year.
But in order to have kept its listing schedule on track, the Milan-based company needed to gain Consob's approval. The additional questions, however, were delivered just twenty-four hours before an approval deadline last night was due to be met.
Parmalat had based its floatation proposal, submitted in September last year, on trading figures from the first six months of 2004, but now its auditors will have to assemble and submit a new application using the company's entire annual accounts for that year.
In accordance with Italian law, Consob then has sixty days to approve these figures - providing its previous questions are answered satisfactorily - although the Italian media have already suggested that Parmalat will now not be able to relist until the close of 2005.
Following the company's highly publicised accounting scandal in December 2003, prior to which Parmalat racked up a €14.3 billion net debt pile, investors and former creditors lost millions.
A public floatation would have partly offset these losses, buoyed confidence in the beleaguered company and also appeased former creditors, which last year voted unanimously in favour of a plan to convert existing debt for equity.
Parmalat, Bondi and his team yesterday remained tight-lipped over Consob's demands and told the Italian press that the company did not know when its 2004 accounts would be approved.
Bondi previously had refused to recognise many of Parmalat's former creditors' claims for compensation, but Parma-based judge Guiseppe Coscioni has since ruled that Parmalat had to accept almost €20 billion in credit claims - rather than the €14 billion that administrators had previously sought.
Bondi's decision to initially reject claims was centred on the fact that Parmalat's creditors continued to keep the company afloat, despite knowing that it was experiencing financial difficulties.