Parmalat has reached a EUR4.2m (US$5.9m) deal with Banca Etruria to settle all litlgation relating to the company’s financial collapse in December 2003.

A spokesperson for the company told just-food today (7 July) that it is “satisfied” with the result, which will see the company drop any move to pursue the bank for further damages relating to its alleged involvement in the dairy group’s bankruptcy.

Parmalat collapsed under debts of EUR14bn, the victim of fraud allegedly perpetrated by its former managers.

Parmalat has accused a number of its former banks of assisting in the concealment of corrupt activity by former company executives. The group has since recouped damages in excess of EUR2bn.