Parmalat returns with lawsuit booty

By Chris Mercer

- Last updated on GMT

Related tags: Parmalat, Milk

Scandal-hit Italian dairy Parmalat has re-listed on the Milan stock
exchange as potential bidders begin to circle and the group widens
its lawsuit war against the world's major banks.

Parmalat re-listed on Thursday with 1.6bn shares valued at €3.15 each, two years after the discovery of a €14bn hole in its accounts made it a household name for all the wrong reasons.

But, 2005 has seen the firm rising phoenix-like from the flames under the stewardship of administrator Enrico Bondi.

His aim was to recover €7bn from companies involved in dealings with Parmalat's previous management on the grounds that these firms were fully aware of the company's unhealthy finances.

Bondi has already managed around €8bn in damages from lawsuits against the group's auditors and banks.

Yet, there will be no rest for Parmalat's sleep-deprived lawyers. The firm announced on Tuesday that it would sue Credit Suisse First Boston for around €7bn over its alleged role in the dairy firm's collapse. And this follows hot on the heels of a €1.3bn compensation claim against Italian banking group Sanpaolo IMI.

By June this year Bondi's new Parmalat had filed 49 lawsuits against various banks and advisors. Counter-claims, like the one launched this year by CitiGroup, pose a risk but so far the tactic seems to be working out.

And Parmalat's resurgence has already attracted interest from potential bidders across the dairy industry.

Italy's leading fresh milk producer, Granarolo, announced on Tuesday it was considering a bid for Parmalat, while there are rumours of interest from other top European dairies too, including France's Lactalis and even world number one food firm Nestlé.

Even so, most firms are likely to wait and see just how Parmalat performs before jumping on to a ship that is not yet guaranteed to float.

Parmalat's re-list comes only a week after the trial of its founder, Carlisto Tanzi, collapsed on its first day as the list of those baying for blood grew. The trial will re-start on 2 December after the court has decided whether to add in civil suits from investors damaged by the collapse.

Tanzi stands accused of manipulating the stock market, publishing false balance sheets and obstructing regulation by the stock market watchdog Consob.

Related topics: Manufacturers

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