The Chilean unit of scandal-hit Italian food group Parmalat has filed for court protection from creditors.

Parmalat Chile owes more than US$4m to its dairy farmer suppliers and at least one bank lender has requested the company’s assets be frozen, reported Reuters.

Following the discovery of a billion euro hole in its accounts in December, Parmalat has filed for bankruptcy protection in Italy, Brazil, the Netherlands and now Chile.

Parmalat Chile, which was the country’s fifth-largest dairy firm last year with $45m in sales, has been in talks with at least one potential buyer, Reuters reported.