COMPANY NEWS; UNIT OF PARMALAT THAT SELLS MILK EXITS BANKRUPTCY
Published: April 15, 2005
The United States unit of Parmalat Finanziaria, Italy's biggest food company, exited bankruptcy yesterday with a plan to continue selling milk in New York, New Jersey and Michigan. The subsidiary, Farmland Dairies, will pay creditors and expenses with a $56 million loan from LaSalle Business Credit and a $45 million loan from the General Electric Company's GE Commercial Finance unit, according to court papers. In exchange for $39 million in financing provided to Farmland and its Parmalat USA Corporation affiliate during bankruptcy proceedings, General Electric will receive a 70 percent stake in Farmland, all of its preferred stock, $11.6 million in litigation proceeds and up to $2 million in additional payments. Parmalat USA is liquidating its assets and will no longer exist. Farmland and Parmalat USA filed for bankruptcy protection in February 2004, two months after Parmalat Finanziaria, based in Milan, sought bankruptcy protection in Italy.