May 2, 2011

Lactalis launches bid for Parmalat's remaining shares

The French dairy group Lactalis SA has launched a EUR3.4 billion cash bid for the remaining stake in Italian company Parmalat SpA.

Lactalis already owns 29% of the company.

Parmalat's share price rose on the Milan Stock Exchange by 11% on the release of the news. Unlised Lactalis, the biggest dairy group in Europe, is offering EUR2.60 a share for the 71% remaining shares, a 21% premium over Parmalat's average share price over the past 12 months.

There is strong opposition in Italy to the takeover by Lactalis. The argument is that Parmalat is of strategic importance for the agro-food industry and must remain Italian.

Recently, several Italian companies have been taken over by French companies and there is raising concern in Rome that Italian industry is losing its champions to French multinationals.