Skip to main content International
The Web      Powered by

Parmalat: 40-year history at stake

Tanzi has resigned from the company he founded in 1961.
Tanzi has resigned from the company he founded in 1961.

Story Tools

Should the Italian government bail out Parmalat?

(CNN) -- Italian food group Parmalat, which faces the threat of possible bankruptcy, has left a very visible footprint on the landscape of the country where it began more than 40 years ago.

From modest beginnings in a small Italian town, Parmalat has grown to become a multi-national corporation employing tens of thousands of people and producing a wide range of consumer products.

Parmalat was formed in 1961 by Calisto Tanzi -- the person who led the company until December, when he was replaced by turnaround expert Enrico Bondi.

Tanzi set up a small pasteurization plant in the town of Collection with the aim of supplying milk to the city of Parma and neighboring areas.

In 1965, Parmalat began to sell specialized milk products from herds that were certified free of tuberculosis -- something other Italian milk producers had yet to do.

The company has since added new milk and dairy products, as well as fruit juices, bakery goods and tomato-based products.

Its brand names include Archway, Frica, Grisbi, Mother's, Pomi and Welsh Farms. It also owns the Parma football club.

Parmalat employs more than 36,200 people in 146 plants in 30 countries on five continents. Bankruptcy would threaten those jobs, along with the repayment of about 2 billion euros in bank loans and 4 billion euros owed to bondholders.

Parmalat employs more than 36,200 people on five continents.

On Friday, the company revealed it had a hole in its accounts of almost 4 billion euros ($4.9 billion), making it the biggest European corporate scandal to date.

The company could ask the courts to put it in "controlled administration" as soon as Monday, an industrial source told Reuters news agency. The Italian cabinet is expected to discuss the crisis on Tuesday. (Full story)

Parmalat shares have plunged in recent weeks, after it missed a bond payment. They fell 66 percent Friday and were worth about 0.10 euros on Monday, when regular trading was suspended.

Story Tools
Click Here to try 4 Free Trial Issues of Time! cover
Top Stories
CNN/Money: Convictions in Tyco case
Top Stories
EU 'crisis' after summit failure

On CNN TV E-mail Services CNN Mobile CNN AvantGo CNNtext Ad info Preferences
   The Web     
Powered by
© 2005 Cable News Network LP, LLLP.
A Time Warner Company. All Rights Reserved.
Terms under which this service is provided to you.
Read our privacy guidelines. Contact us.
external link
All external sites will open in a new browser. does not endorse external sites.
 Premium content icon Denotes premium content.