The government of Italy has given the go-ahead to the proposal by beleaguered food manufacturer Parmalat that it swap much of its debt for shares.

The approval from Industry Minister Antonio Marzano came after meetings yesterday [Tuesday] with labour unions and Enrico Bondi, Parmalat’s government-appointed administrator. Marzano still has the option of asking for small changes in the debt-for-shares proposal, reported AFX.

Creditors must now approve the plan. Should they reject it, Parmalat my be forced out of business.

Parmalat unveiled its turnaround plan earlier this month. You can read more details by clicking here.