Parmalat Brazil and Parmalat Participações get court protection

By Jeff Pines

Washington, Aug. 13 - Parmalat Brazil and Parmalat Participações obtained protection under Brazilian bankruptcy law Thursday, Parmalat Finanziaria SpA, the companies' Italian parent, said.

Brazilian law gives the companies 24 months to reorganize.

One possible restructuring plan, presented by Integra Associados, calls for the creditors to get all of the equity in the reorganized companies, the Italian dairy company said.

If this happens, the connection between Parmalat Finanziaria and the Brazilian companies would be the licensing of the Parmalat and Santal names as well as the exchange of product and technical expertise.

Earlier this week, Parmalat Brazil recovered control of its Itaperuna plant, which had been under court supervision for the past five months, Parmalat Finanziaria said. Representatives of the state of Rio de Janeiro, the local community and regional suppliers were managing the plant.

Parmalat Finanziaria filed for bankruptcy on Dec. 24 in Italian court.

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