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February 6, 2004

BRAZIL: Parmalat Brasil may sell assets to avoid collapse

The Brazilian unit of scandal-ridden Italian food group Parmalat has said it will be forced to stop operating in a matter of days unless the company receives a cash injection of US$26m, and may sell assets in order to survive.

The Brazilian unit of scandal-ridden Italian food group Parmalat has said it will be forced to stop operating in a matter of days unless the company receives a cash injection of US$26m, and may sell assets in order to survive.

“The survival of Parmalat is a matter of days. We’re talking about days, not weeks,” Ricardo Goncalves, president of Parmalat Brasil Industria de Alimentos, was quoted by Reuters as saying. 

“The solution should be through the negotiation of a purchase of the company, a part of it,” he added.

Goncalves said the company had authorisation from its Italian parent to sell part or all its operations, and added that two of the company’s dairy factories had interested potential buyers.

Parmalat Brasil filed for bankruptcy last week as it struggled to pay suppliers and creditors, and this week has stopped production at some of its plants.

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