Dairy firm `not affected' by bankrupcy application
( 2003-12-24 02:39) (China Daily)
Parmalat's business operations in China were unaffected yesterday although the Italian food-and-diary giant was seeking bankruptcy protection due to a widening scandal over a multibillion-euro hole in its balance sheet.
"Currently, things are going well here,'' said an official from the Beijing Branch of Parmalat (Tianjin) Diary Co Ltd, but he refused to respond to some market rumours.
Previous Chinese media reports claimed that the general manager of the firm disappeared for several days and Parmalat's diary products were seldom seen on Beijing's supermarket shelves.
Top officials of the Tianjin Firm, Parmalat's base in China, were unavailable yesterday.
The diary giant's joint venture in Nanjing was also operating normally.
"The joint venture runs as usual and the firm's scandal in Europe has not had any impact on its manufacturing and sales in China,'' said Li Xianbin, director of the general office of Nanjing Diary (Group) Co Ltd, the local partner of Parmalat's Nanjing venture.
Li told China Daily that his firm paid great attention to Parmalat's problems, but refused to say whether it will affect the venture's future.
The venture, after Parmalat transferred its management control to Nanjing Diary Group in May due to huge losses, has had a better performance than previously.
The venture aims to make profits in three years' time.
Parmalat's scandal, being dubbed as "Europe's Enron,'' was set off last Friday when the firm revealed that the Bank of America Corp was not in fact holding about 3.95 billion euros (US$4.9 billion) of its funds, as the Italian company had reported in September.
Foreign news agencies said prosecutors now believed the total hole in Parmalat's balance sheet may be almost 7 billion euros (US$8.5 billion), after the discovery of 2.9 billion euros (US$3.6 billion) in bonds Parmalat said it had bought back but had not.
Parmalat had a market value of 1.8 billion euros (US$2.2 billion) before the crisis broke, but its shares are now almost worthless and its bonds are trading at barely 20 per cent of face value.
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