Prosecutors in Italy have applied for the board of Parmalat to be removed and the cancellation of dairy giant’s acquisition of the US arm of majority shareholder Lactalis.
A court in Parma is today (1 March) hearing arguments for Parmalat to be run by a judicial administrator for the next four to five months.
Prosecutor Gerardo Laguardia told reporters the time under a judicial administrator was “needed to implement the necessary actions for the acquisition contract of Lactalis in the United States to be declared nul and void”, according to Reuters.
Parmalat’s US$904m acquisition of Lactalis American Group last year has been criticised by minority shareholders in the Italian dairy giant. The investors argue the deal was not in the interests of all the shareholders in Parmalat, which is majority-owned by French dairy group Lactalis.
The court has 30 days in which to decide on the prosecutors’ request. Parmalat has refused to comment on the application, although it has in recent months defended the acquisition of Lactalis American Group.
Lactalis bought 83.3% of Parmalat in 2011 for EUR3.4bn (US$4.43bn), a deal that was opposed by some in Italy who wanted to keep the company in domestic hands.