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Parmalat adds CSFB to list of lawsuits

Parmalat filed for bankruptcy protection in January

(Keystone)

Collapsed Italian dairy giant Parmalat says it is suing Credit Suisse First Boston to recover €248 million (SFr381 million) related to a bond issue.

CSFB is the latest company to be targeted by the bankrupt group, which has already filed lawsuits against several banks, including UBS, and its former auditors.

Parmalat said on Thursday that it had filed a lawsuit in Parma, Italy. It wants to recover the money, plus interest, related to a bond issue that CSFB underwrote in 2002. It added that it reserved the right to sue the bank for further damages.

CSFB refused to comment.

Parmalat, which is reeling from a fraud scandal, says it is seeking to recover billions of euros from former financial advisers, which administrators blame for helping to drive the firm into bankruptcy.

Others banks being sued are Swiss bank UBS (for €290 million), Citigroup and Deutsche Bank. Parmalat is also seeking damages of "at least $10 billion" from its former auditors, Deloitte and Touche and Grant Thorton.

Complicated

In its lawsuit against UBS, Parmalat said its paid the bank €290 million in a complicated deal that allowed the food company to borrow money from the bank at low rates it could not find on the open market.

Parmalat, which is now being run by a government-appointed turnaround expert, said it was also seeking interest on the sum.

UBS and the other organisations named in lawsuits have denied the accusations and said they will defend themselves.

An analyst at DebtTraders, which deals in "distressed" securities, said the markets were expecting Parmalat to win about €375 million from its claims.

The Parmalat scandal erupted in December when the conglomerate acknowledged it did not have billions of euros in funds it claimed was in a Bank of America account.

Parmalat then went into bankruptcy protection, and prosecutors have been investigating numerous former members of the company’s management.

swissinfo with agencies

In brief

Parmalat has now filed lawsuits against two Swiss banks - UBS and the investment banking arm of Credit Suisse.

It is seeking to recover billions of euros from its former advisers, who it blames for helping to bring down the company.

The failed Italian food giant is reeling from a massive fraud scandal involving billions of euros in missing money.

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