ITALY: Parmalat reveals €4bn cash crisis
Italian dairy giant Parmalat today [Friday] revealed a €4bn (US$4.9bn) shortfall in its accounts after Bank of America Corp. informed it that the bank isn't holding the €4bn in liquidity it reported on its books in September.
Bank of America rejected the authenticity of a document listing €3.95bn worth of securities and cash held by Bonlat Financing Corp., an offshore unit of the troubled Italian food group. Currently it is unclear who prepared the alleged false document, or where the €3.95bn in cash is located if it's not at Bank of America.
Bonlat and a Cayman Islands-based investment fund Epicurum have been the focus of an emergency probe into Parmalat's accounts by PriceWaterhouseCoopers, hired by the group's new management this week.
Parmalat shares have been suspended limit-down on the Milan bourse.
Newly appointed chairman and chief executive Enrico Bondi - a turnaround expert hired this week - is reported to have called an extraordinary board meeting for Friday afternoon.
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